Question: Tom entered into an agreement to sell his multi-family housing complex to a private equity group for $85 million, which is Tom's asking price. Tom valued his business based on his cost of capital of 12%. Both buyer and seller agree on the expected future cash flows from the complex, which is based on a third party appraiser' estimate. Based on these facts, which of the following statements is MOST correct? Tom's cost of capital must be greater than that of the private equity group The cost of capital is irrelevant in this transaction Tom's cost of capital must be the same as that of the private equity group Tom's cost of capital must be less than that of the private equity group