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Teall Development Company hired you as a consultant to help them estimate its cost of capital. You have been provided with the following data: D

Teall Development Company hired you as a consultant to help them estimate its cost of capital. You have been provided with the following data: D1 = $1.40; P0 = $38.00; and g = 6.50% (constant). Based on the DCF approach, what is the cost of equity from retained earnings?

a. 3.92%
b. 9.96%
c. 10.42%
d. 10.18%
e. 3.68%

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