Question
1. A firm's common stock currently sells for $40 per share. The firm's most recent dividend paid (D0) is $2 per share on its common
1. A firm's common stock currently sells for $40 per share. The firm's most recent dividend paid (D0) is $2 per share on its common stock, and investors expect the dividend to grow indefinitely at a constant rate of 10% per year. What's the firm's cost of common stock using the DCF approach?
The answer is 15.5%.
please explain
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The Management Of Business Finance
Authors: John Freear
1st Edition
0273014315, 978-0273014317
