BUMZ sunglasses is currently financed with 100% equity, its…
BUMZ sunglasses is currently financed with 100% equity, its beta is 1.25 and its tax rate is 20%. If the risk free rate is 4% and the MRP (market risk premium) is 6% and BUMZ decides to add debt to its capital structure such that debt is 30% and equity is 70% of total capital, how much will equity investors required return increase from what it was before the debt was added? Answer as a whole percent rounded to two decimal points; for example 4.57% for your answer.