ABC Auto, a manufacturer of auto component is planning to raise a capital of TZS 100.The current price of the share in the market is TZS 230 per share. The track record of the growth in dividend and earnings has been encouraging as ABC Auto has doubled dividend in the last five years. The dividend payout per share for the last five years has been as follows:

Year	2019	2018	2017	2016	2015
Dividend	20	17.5	15	12.5	10

Required:

(a) What is the cost of equity for ABC Auto?

(b) Would the cost of equity change if the ABC Auto has to incur a floating cost of 3%.