1 B C D E F G A Follow the steps to calculate cost of equity Dividend 2 Year 3 1995 4 1996 Total per share dividends 0.25 $1,075,000.00 0.25 $1,075,000.00 Number of share repurchases 0 Payments from share Total payments repurchases to shareholders 115,000 $140,000.00 $1,215,000.00 $0.00 $1,075,000.00 5 1997 0.3 $1,255,500.00 0 6 1998 0.31 $1,297,350.00 200,000 $260,000.00 $0.00 $1,255,500.00 $1,557,350.00 7 1999 0.35 $1,394,750.00 120,000 $180,000.00 $1,574,750.00 8 2000 9 2001 10 2002 0.37 $1,430,050.00 0.39 $1,507,350.00 0.42 $1,623,300.00 0 0 $0.00 $1,430,050.00 $0.00 $1,507,350.00 120,000 $220,000.00 $1,843,300.00 11 12 Share price, end of 2002 13 Number of shares 14 Cinema Market Value 15 16 Dividend compound growth rate 17 Cost of equity, re 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 1.83 3,745,000