To solve this, we can use the following relationship from the Modigliani-Miller Proposition II (without taxes), which tells us how the cost of equity changes as a company introduces debt into its capital structure:

$r_E = r_U + (r_U - r_D) \cdot \frac{D}{E}$

Where:

• $r_E$ is the new cost of equity (which we need to calculate).
• $r_U$ is the unlevered cost of equity (the original cost of equity when the firm was 100% equity-financed), which is 15%.
• $r_D$ is the cost of debt, which is 8%.
• $\frac{D}{E}$ is the debt-to-equity ratio (the firm will have 28% debt and 72% equity, so $\frac{D}{E} = \frac{28}{72}$).

Let's calculate the new cost of equity.

$r_E = 15\% + (15\% - 8\%) \cdot \frac{28}{72}$

Now, I'll compute the final result.The new cost of equity is 17.72%.

Would you like further details or clarification on any part of this calculation?

Here are five related questions to expand on this:

1. How does Modigliani-Miller Proposition II affect capital structure decisions?
2. How does an increase in the proportion of debt affect the cost of equity?
3. What happens to the WACC when a firm introduces debt?
4. How does the risk of bankruptcy influence the decision to issue debt?
5. What are the tax implications when using debt in a firm's capital structure?

Tip: When increasing debt in a firm's capital structure, the cost of equity tends to rise because shareholders bear more risk, compensating for the additional financial leverage.