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Common Stock A company just paid dividends of $ 2 . 7 5 per share. The company has a constant growth of 5 . 5

Common Stock
A company just paid dividends of $2.75 per share. The company has a constant growth of 5.5%. The risk-free rate is 2.25%, beta is 0.80 and market return of 8%. Market value of the common stock is $500,000.
a. Determine the rate of return using the CAPM.
b. Determine the weighted average cost of capital for the company.

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