The stock market data given by the following table. Correlation Coefficients Mexico World SD (%) R (%) Telmex 1.00 Telme

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The Stock Market Data Given By The Following Table Correlation Coefficients Mexico World Sd R Telmex 1 00 Telme 1 (22.87 KiB) Viewed 37 times

The stock market data given by the following table. Correlation Coefficients Mexico World SD (%) R (%) Telmex 1.00 Telmex 0.75 0.50 20 ? Mexico 1.00 0.60 12 14 World 1.00 8 12 The above table provides the correlations among Telmex, a telephone/communication company located in Mexico, the Mexico stock market index, and the world market index, together with the standard deviations (SD) of returns and the expected returns ( R ). The risk-free rate is 4%. Suppose the Mexican stock market is segmented from the rest of the world. Using the CAPM paradigm, estimate the equity cost of capital of Telmex. (Enter your answer as a percent rounded to 2 decimal places.) Equity cost %