eBook Problem Walk-Through Cost of Equity: Dividend Growth Summerdahl Resort's common stock is currently trading at $38 a share. The stock is expected to pay a dividend of $1.50 a share at the end of the year (D1 = $1.50), and the dividend is expected to grow at a constant rate of 5% a year. What is the cost of common equity? Round your answer to two decimal places. % Grade it Now Save & Continue Continue without saving