Finance

Other
Tutor: None Selected Time limit: 3 Days

A new common stock issue that paid a $1.76 dividend last year. The firm's dividends are expected to continue to grow at 6.5% per year forever. The price of the firm's common stock is now 27.62. The cost of capital from the common equity is?
Sep 15th, 2013
Cost of Equity Capital = D0*(1+g)/Price + g = (1.76*(1.065)/27.62) + .065 = 13.286%
Sep 15th, 2013

Studypool's Notebank makes it easy to buy and sell old notes, study guides, reviews, etc.
Click to visit
The Notebank
...
Sep 15th, 2013
...
Sep 15th, 2013
Feb 28th, 2017
check_circle
Mark as Final Answer
check_circle
Unmark as Final Answer
check_circle
Final Answer

Secure Information

Content will be erased after question is completed.

check_circle
Final Answer