LeisureInc. has the following information concerning itsdebt and equity:The firm

LeisureInc. has the following information concerning itsdebt and equity:The firm has 2M common shares outstanding. They were issued at aprice of $20 and are currently trading at a price of $35. Theshares yesterday paid a dividend of $2.38 and the dividend isexpected to grow by 5% per year forever.The firm also has15000 zero coupon bonds outstanding. The bonds have four years tomaturity and are trading at $850 each. The par value of each bondis$1000.The firm has a marginal tax rate of 25%.a. What is the required rate of return on the firms commonshares?