9. Stock in Country Road Industries has a bet While T-bills are currently vielding 2.5 percent. Country ko share and dividends are expected to grow at sells for $26 a share. What is the estimated cost of equity a. 11.96 percent b. 13.45 percent c. 10.46 percent d. 10.73 percent e. 12.09 percent stries has a beta of 1.46. The market risk premium is 7.5 percent ercent. Country Road's last dividend was $1.55 per pected to grow at an annual rate of 4.5 percent indefinitely. The stock 10. All else the same, a decrease in a firm's dividend payout ratio will decrease its: I. Sustainable growth rate. II. Internal growth rate. III. External financing needed. a. III only b. II and III only c. I only d. II only e. I and II only a. Your company purchased a piece of land five years ago for $150,000 and subsequently added $175,000 in improvements. The current book value of the property is $225,000. There are two options for future use of the land: 1) the land can be sold today for $375,000 on an aftertax basis; 2) your company can destroy the past improvements and build a factory on the land. In consideration of the factory project, what amount (if any) should the land be valued at? The present book value of $225,000. The aftertax salvage value of $375,000. The sales price of $375,000 less the book value of the improvements. The original $150,000 purchase price of the land itself. The property should be valued at zero since it is a sunk cost. b. C. d. e