Q7. Walid IQ Berhad's last annual dividend was 40 sen per share and both earnings and dividend are expected to grow at a constant rate of 3 per cent. Currently the share sells for RM3.20 per share. The Company's beta coefficient is 4.5, the return of a market portfolio is 5 per cent and the risk-free rate is 2 per cent. Calculate the cost of retained earnings using the Gordon's growth model and the capital asset pricing model (CAPM). A. 17.87%; 16.86% B. 5.87%; 5.65% C. 15.875%; 15.5% D. 23.26%22.87% (1 mark)