Musical Charts just paid an annual dividend of $4.85 per share. This dividend is expected to increase by 4.7 percent annually. Currently, the firm has a beta of 1.89 and a stock price of $20 a share. The risk-free rate is 2.6 percent and the market rate of return is 15.8 percent.

Calculate the cost of equity using the Dividend Growth Method.

RE = %

Calculate the cost of equity using the Security Market Line approach.

RE = %

What is the cost of equity capital for this firm?

RE = %