Calculating Cost of Equity: Stock in Country Road Industries has a beta of 1.25. The market risk premium is 7 percent, and T-bills are currently yielding 5 percent. Country Road's most recent dividend was $2.10 per share, and dividends are expected to grow at a 5 percent annual rate indefinitely. If the stock sells for $34 per share, what is your best estimate of the company's cost of equity? Calculating Cost of Preferred Stock: Holdup Bank has an issue of preferred stock with a $5 stated dividend that just sold for $87 per share. What is the bank's cost of preferred stock