Please give me true answer this financial accounting question Horizon Tech Ltd. has a beta of 1.1. The yield on a 3-month T-bill is4.8%, and the yield on a 10-year T-bond is 6.5%. The market riskpremium is 6.2%, and the return on an average stock in the marketlast year was 18%.What is the estimated cost of common equity using the CAPMmodel?a. 11.32%b. 12.50%c. 13.32%d. None of the above

Step 1: Define Cost of Common Equity (Using CAPM Model)The Cost of Common Equity represents the…

Answered: Horizon Tech Ltd. has a beta of 1.1.…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter11: Determining The Cost Of Capital

Section: Chapter Questions

Problem 6P

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