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Stock in Globex Corporation has a beta of 0.9. The expected market return is 10%, and T-bills are currently yielding 3.5%. The company's next dividend
Stock in Globex Corporation has a beta of 0.9. The expected market return is 10%, and T-bills are currently yielding 3.5%. The company's next dividend is expected to be $2 per share, and dividends have been growing at a 4% annual rate. If the stock sells for $25 per share, what is your best estimate of the company's cost of equity?
Select one:
a. 8.86%
b. 10.68%
c. 7.95%
d. 9.77%
e. 11.59%
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