Our team used the following method to come up with the companys discount rate

r
(1) Using the Capital Asset Pricing Model:
E(R) = Rf+ (Rm- Rf)
Where,
E(R) = r = Expected rate of return of stock
Rf = Risk free rate of return
= Measure of volatility of stock in comparison to market
Rm = Expected rate of return of the market portfolio
Calculations:
Rf = Average of 90-day Treasury Bill rate since 1952 (Department of Treasury) =
4.9%
= Average of Yahoo Finance and Google values = (1.02+.89)/2= 0.96
Rm= Average of US stock returns since 1957 = 11.64%
Substituting values in original equation, we get discount rate r = 11.34%