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As the assistant to the CFO of Johnstone Inc., you must estimate its cost of common equity. You have been provided with the following data:

As the assistant to the CFO of Johnstone Inc., you must estimate its cost of common equity. You have been provided with the following data: D0 = R0.5 ; P0 = R21. 17 and gL = 7% (constant). Based on the dividend growth model, what is the cost of common from reinvested earnings?

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