Carolina Insurance Company, an All-Equity Life Insurance Firm, Is Considering

Carolina Insurance Company, an all-equity life insurance firm, is considering the purchase of a fire insurance company. The fire insurance company is expected to generate a return of 20 percent with a beta of 2.5. If the risk-free rate is 8 percent and the market risk premium is 6 percent, the expected return from the insurance company is _____.

A) 10%
B) 23%
C) 14%
D) 29%
E) 8%