Question
S. Bouchard and Company hired you as a consultant to help estimate its cost of capital. You have obtained the following data: D0 = $0.85;
S. Bouchard and Company hired you as a consultant to help estimate its cost of capital. You have obtained the following data: D0 = $0.85; P0 = $22.00; and g = 6.00% (constant). The CEO thinks, however, that the stock price is temporarily depressed, and that it will soon rise to $40.00. By how much would the cost of equity from retained earnings change if the stock price changes as the CEO expects? Group of answer choices -1.49% -1.66% -1.84% -2.03% -2.23%
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Financial Management In The Public Sector Tools Applications And Cases
Authors: Xiaohu Wang
2nd Edition
0765625229, 9780765625229
