Use the capital asset pricing model (CAPM) to estimate the cost of equity capital for a venture with the following information.

You notice historically for each percentage change in the market return, this venture's return has changed by 1.50%.

Interest rate on long-term U.S. government securities = 4%.

Market risk premium = 7%.

Question 4 options:

	10.50%.
	14.50%.
	16.50%.
	7%.
	11%.
	13%.