1) You purchased 580 shares of stock at a price of $59.37 per share. Over the last year, you have received total dividend income of $680. What is the dividend yield? 1.2 percent

a) 66.4 percent

b) 2.0 percent

C)11.5 percent

d)13.4 percent

2)

The Down and Out Co. just issued a dividend of $2.41 per share on its common stock. The company is expected to maintain a constant 4 percent growth rate in its dividends indefinitely. If the stock sells for $55 a share, what is the company's cost of equity? (Do not round your intermediate calculations.)

rev: 09_20_2012

8.38%

8.13%

8.56%

4.63%

8.98%