C. The Blue Dog Company has common stock outstanding that has a current price of $20 per share and a $0.5 dividend. Blue Dog's dividends are expected to grow at a rate of 3% per year, forever. The expected risk-free rate of interest is 2.5%, whereas the expected market premium is 5%. The beta on Blue Dog's stock is 1.2. a. What is the cost of equity for Blue Dog using the dividend valuation model? [2 marks] b. What is the cost of equity for Blue Dog using the capital asset pricing model? [2 marks] 3