The Ivankiv company currently has no debt and a given tax rate.

You are given the current cost of equity and the cost of debt that it could issue.

What would the Modigliani$-$Miller theorem suggest for the cost of equity if the company levered up to a new debt to equity ratio?

Tax rate $9\mathrm{.}00\%$

Current debt $$-$

Cost of equity $27\mathrm{.}00\%$

Cost of debt $8\mathrm{.}00\%$

New debt to equity ratio $1\mathrm{.}30$