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Im not really sure how to calculate p9-10 -C and D in excel format... The Cost of Capital385 CHAPTER 9 Cost of common stock equity:

Im not really sure how to calculate p9-10 -C and D in excel format... image text in transcribed
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The Cost of Capital385 CHAPTER 9 Cost of common stock equity: CAPM J&M Corporation common stock has a beta, -A of 12. The risk-free rate is 6%, and the market return is 1 1 % a. Determine the risk premium on J&M common stock. b. Determine the required return that J&M common stock should provide. c. Determine J&M's cost of common stock equity using the CAPM. P9-9 easure its cost of common P9-10 Cost of common stock equity Ross Textiles wishes to m stock equity. The firm's stock is currently selling for $57.50. The firm expects to pay a $3.40 dividend at the end of the year (2016). The dividends for the past 5 years are shown in the following table. YearDividend S3.10 2.92 2.60 2.30 2.12 15 2014 2013 2012 2011 After underpricing and flotation costs, the firm expects to net $52 per share on a new issue a. Determine the growth rate of dividends from 2011 to 2015 b. Determine the net proceeds, N, that the firm will actually receive c. Using the constant-growth valuation model, determine the cost of retained earnings, T-IS. d. Using the constant-growth valuation model, determine the cost of new common So- stock, Retained carnings versus new common stock Using the data for each firm shown in the following table, calculate the cost of retained earnings and the cost of new com- p9-11 Torrencemo File Home Insert Page Layout Formulas Data ReviewView Help B25 YearDividend 2015 $3.10 2014 2.92 2012 2011 2.3 2.12 Dividend Growth rate 10 A. ar 2011$ 2.12 2012 $ 2.30 2013 $ 2.60 2014 $ 2.92 2015 $ 3.10 2016$ 3.40 13.0% 12 6.2% 9.7% Net proceeds sale value-floatation cost+- Premium/Discount The firm expects the share price of $52 after under-pricing and flotation costs. The net proceeds will be $52 21 B. SheetSheet? Sheet2 SheetsSheet

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