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Nelson Enterprises just paid an annual dividend of $1.56 per share. This dividend is expected to increase by 3 percent annually. Currently, the firm has

Nelson Enterprises just paid an annual dividend of $1.56 per share. This dividend is expected to increase by 3 percent annually. Currently, the firm has a beta of 1.13 and a stock price of $28 a share. The risk-free rate is 3 percent and the market rate of return is 10.5 percent. What is your best estimate of Nelsons cost of equity?

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