The common stock of Pittsburgh Steel Products has a beta of 1.42 and a standard deviation of 21.6 percent. The market rate of return is 12.5 percent and the risk-free rate is 5 percent. What is the cost of equity for Pittsburgh Steel Products?
a. 15.65 percent
b. 17.75 percent
c. 18.45 percent
d. 20.50 percent
e. 22.75 percent