Pony corporation is undertaking a capital budgeting, Ask an Expert

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Pony Corp. is undertaking a capital budgeting analysis. The firm's beta is 1.5. The rate on 30-year U.S. Treasury bonds is 5%, and the return on the S & P 500 index is 12 %. What is the cost of Pony's retained earnings?

a.) 13.3%

b.) 15.5%

c.) 17.7%

d.) 19.9%

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