You would like to estimate the weighted average cost of capital for a new airline business. Based on its industry asset beta, you have already estimated an unlevered cost of capital for the firm of 9 %. However, the new business will be 22 % debt financed, and you anticipate its debt cost of capital will be 5 %. If its corporate tax rate is 37 %, what is your estimate of its WACC?

The equity cost of capital is

please explain the answer as well thank you