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The future earnings, dividends, and common stock price of Callahan Technologies Inc. are expected to grow 5 % per year. Callahan's common stock currently sells
The future earnings, dividends, and common stock price of Callahan Technologies Inc. are expected to grow per year. Callahan's common stock currently sells for $ per share; its last dividend was $; and it will pay a $ dividend at the end of the current year. a Using the DCF approach, what is its cost of common equity? Do not round intermediate calculations. Round your answer to two decimal places. b If the firm's beta is the riskfree rate is and the average return on the market is what will be the firm's cost of common equity using the CAPM approach? Round your answer to two decimal places. c If the firm's bonds earn a return of based on the bondyieldplusriskpremium approach, what will be Use the judgmental risk premium of in your calculations. Round your answer to two decimal places. d If you have equal confidence in the inputs used for the three approaches, what is your estimate of Callahan's cost of common equity? Do not round intermediate calculations. Round your answer to two decimal places.
The future earnings, dividends, and common stock price of Callahan Technologies Inc. are expected to grow per year. Callahan's common stock currently
sells for $ per share; its last dividend was $; and it will pay a $ dividend at the end of the current year.
a Using the DCF approach, what is its cost of common equity? Do not round intermediate calculations. Round your answer to two decimal places.
b If the firm's beta is the riskfree rate is and the average return on the market is what will be the firm's cost of common equity using
the CAPM approach? Round your answer to two decimal places.
c If the firm's bonds earn a return of based on the bondyieldplusriskpremium approach, what will be Use the judgmental risk premium of
in your calculations. Round your answer to two decimal places.
d If you have equal confidence in the inputs used for the three approaches, what is your estimate of Callahan's cost of common equity? Do not round
intermediate calculations. Round your answer to two decimal places.
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