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The common stock of Anthony Steel has a beta of 0.9. The risk-free rate is 4.5 percent and the market risk premium (rM - rRF)

The common stock of Anthony Steel has a beta of 0.9. The risk-free rate is 4.5

percent and the market risk premium (rM - rRF) is 5.8 percent. Assume the firm

will be able to use retained earnings to fund the equity portion of its capital budget.

What is the companys cost of retained earnings, rs?

Group of answer choices

10.02%

9.42%

9.12%

9.72%

8.82%

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