WestAce will generate a terminal cash flow of $370M or $110M in one year, each with equal likelihood. WestAce's outstanding debt has a correct market value today of $120M and is due in a year. The cost of debt (rd) is 15% and the unlevered cost of equity (ru) is 20%. The capital market is perfect (no taxes, distress costs, etc.) What is the cost of equity for WestAce? 27.5% 28.5% 29.5% 30.5%