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Quantitative Problem: Barton Industries estimates cost of common equity by using the approaches the CAPM, the bond-yield.plus-risk-premium approach, and the DCF model. Barton expects next

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Quantitative Problem: Barton Industries estimates cost of common equity by using the approaches the CAPM, the bond-yield.plus-risk-premium approach, and the DCF model. Barton expects next year's annual dividend, to be $1.0 and it expects dividends to grow it a constant rate 9 -5.29. The firm's current common stock price, Pis $20.00. The current risk-freete, ur. -44% the market risk premium, P.5.7, and the firm's stocks a current beta, - 1.15. Assume that the firm's cost of debt, is 14.75. The firm uses a 2.7 risk premium when arriving at har estimate of its cost of equity in the bond-yield-plus-premium approach What is the few's cost of equity using each of these three approaches and your answers to the decimal places. CAPM cost of equity Bond yield plus opreme DCF coste What is your best state of the firm's cost of equity

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