Floyd Industries stock has a beta of 1.25. The company just paid a dividend of $.40, and the dividends are expected to grow at 5 percent per year. The expected return on the market is 12 percent, and Treasury bills are yielding 5.8 percent. The most recent stock price for Floyd is $75.

a.	Calculate the cost of equity using the DDM method.(Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places (e.g., 32.16).)

DDM method

%

b.

Calculate the cost of equity using the SML method.(Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places (e.g., 32.16).)

SML method

%

Please give explanations on how you got your answers. I have two more questions with the same information , but different numbers.

Thank you!