HighGrowth Company has a stock price of $$22.$ The firm will pay a dividend next year of $$0\mathrm{.}92,$ and its dividend is

expected to grow at a rate of $3\mathrm{.}7\%$ per year thereafter. What is your estimate of HighGrowth's cost of equity capital?

$($i$)$ Click the icon to see the Worked Solution $($Formula Solution$).$

The required return $($cost of capital$)$ of levered equity is ${7\mathrm{.}9}^{TT}\%.($Round to one decimal place.$)$