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Data from a company shows Bam Tech, a public company, has an equity beta of 1.6. Bam Tech just paid (yesterday) a dividend of $1.
Data from a company shows Bam Tech, a public company, has an equity beta of 1.6. Bam Tech just paid (yesterday) a dividend of $1. Dividends are paid annually and are expected to grow in perpetuity at 2%. The current expected market return is 11%, and the risk-free rate is 2%.
If Bam has a 25% tax rate, what is their after tax cost of equity capital?
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