Eston Electronic Company's tressurer uses both the capital soset pricing model and the dividend valustion model to compute the

cost of common equity laso referred to so the required rate of return for common equityl.

Assume:

$R_f=3\%$

$K_m=8\%$

$=1\mathrm{.}2$

$D_1=$$$0\mathrm{.}35$

$P_0=$$$14$

$g=8\%$

a Compute $K$ lrequired rate of return on common equity bsed on the capitsal soset pricing modell.

Note: Do not round Intermedlate calculations. Input your answer a a percent rounded to $2$ decimal places.

An$$wer is complete but n$$t entirely correct.

$1108,x$

b$.$ Compute $K_s$ Irequired rate of return on common equity bsed on the dividend valustion modell.

Note: Do not round Intermediate calculations. Input your answer a a percent rounded to $2$ decimal places.

An$$wer is complete but not entirely correct.