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The Adams company is trying to determine their cost of equity. You would like to use 3 different approaches. Given the following information, calculate the
The Adams company is trying to determine their cost of equity. You would like to use 3 different approaches. Given the following information, calculate the cost of equity according to the CAPM approach [ Select ] , Bond Yield plus Risk Premium approach [ Select ] , and the Discounted Cashflow approach [ Select ] . Current risk-free return is 4.95% Market risk premium is 5.75% Beta of Adams company is 0.92 Adam's bond yield is 10.28% The firm's analysts estimate that the firm's risk premium on its stock over its bonds is 4.95% Their stock is currently selling for $32.45 per share The firm expects to pay a per-share dividend of $1.38 in one year Analysts project the firm's growth rate will be a constant 5.72%
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