The total market value of the common stock of the Okefenokee Real Estate Company is $8.5 million, and the total value of its debt is $5.5 million. The treasurer estimates that the beta of the stock is currently 18 and that the expected risk premium on the market is 7%, The Treasury bill rate is 3%. Assume for simplicity that Okelenokee debt is risk-free and the company does not pay tax a. What is the required return on Okefenokee stock? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) b. Estimate the company cost of capital (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) c. What is the discount rate for an expansion of the company's present business? (Do not round Intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) d. Suppose the company wants to diversify into the manufacture of rose-colored spectacles. The beta of unleveraged optical manufacturers is 0.95 Estimate the required return on Okefenokee's new venture. (Do not round Intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) 96 a. Required return b. Cost of capital C. Discount rate d. Required return 3 9