Historical growth rate estimation a. What is the compound growth rate of dividends based on the last five years of dividends data? (2 marks) Calculate the yeartoyear growth rates in dividends. (2 marks) What is the average year-toyear dividend growth rate? (1 mark) . ABC has a retention ratio of 0.75 and a historical return on equity (ROE) of 0.2. Using these two additional pieces of information, calculate an alternative estimate of dividend growth rate, Q. (1 mark) Dividend growth model e. Given that ABC's share price is currently $65, and the most recent dividend paid is $3.60 per share, use the three growth rates estimated for historical growth (com pound growth rate, average year-toyear growth rate, and alternative estimate) to calculate the cost of equity using the dividend growth model. (3 marks) f. Average the three estimated costs of equity in part (e). (1 mark) SML model 9. Given that the firm's equity beta is 1.6, the risk-free rate is 5%, and the expected return on the market index is 13.5%, calculate its cost of equity using the SML model. (1 mark)