Cornwell Industries stock has a beta of $1\mathrm{.}05.$ The company just paid a dividend of $$0\mathrm{.}54,$ and the dividends are expected to grow at

$4\%.$ The expected return on the market is $12\%,$ and Treasury bills are yielding $4\mathrm{.}2\%.$ The most recent stock price for the company is

$$72.$

a$.$ Calculate the cost of equity using the dividend growth model method. $($Do not round intermediate calculations. Round the final

answer to $2$ decimal places.$)$

Dividend growth model method

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b$.$ Calculate the cost of equity using the SML method. $($Do not round intermediate calculations. Round the final answer to $3$ decimal

places.$)$

SML method

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