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The NuPress Valet Co. has a cost of equity of 12.7%, a pre-tax cost of debt of 5.1%, and a marginal tax rate of 35%.

The NuPress Valet Co. has a cost of equity of 12.7%, a pre-tax cost of debt of 5.1%, and a marginal tax rate of 35%. The common equity of NuPress currently carries a beta of 1.4, its D/E ratio is 0.85, and the expected return on the market is 10.1%. What is the current risk-free rate?

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