Which of these firms has a higher equity cost of capital


Aluminum maker Alcoa has a beta of about 0.99, whereas Hormel Foods has a beta of 1.56 . If the expected excess return of the market portfolio is 4 %, which of these firms has a higher equity cost of capital, and how much higher is it?

The firm that has the higher equity cost of capital is ____ by %.

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Financial Management: Which of these firms has a higher equity cost of capital
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