Question
PLEASE ANSWER THE FOLLOWING QUESTION... Stock in Daenerys Industries has a beta of 1.2. The market risk premium is 6 percent, and T-bills are currently
PLEASE ANSWER THE FOLLOWING QUESTION...
| Stock in Daenerys Industries has a beta of 1.2. The market risk premium is 6 percent, and T-bills are currently yielding 5.3 percent. The companys most recent dividend was $1.70 per share, and dividends are expected to grow at an annual rate of 5 percent indefinitely. |
| If the stock sells for $35 per share, what is your best estimate of the companys cost of equity? (Hint: As you have two approaches, calculate each and take the average as your "best estimate".) |
Cost of Equity? ____%
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Financial Markets and Institutions
Authors: Anthony Saunders, Marcia Cornett
6th edition
9780077641849, 77861663, 77641841, 978-0077861667
