The last five annual dividends for BettsCorp have been: $1.23, $1.42, $1.45, $1.55, and $1.69. Next year's dividend is expected to be $2. The current stock price is $199 per share. First, calculate the geometric average annual rate of growth based on the historical dividends (taking into account the previous five -- do *not* include next year's expected dividend in this calculation). Your estimate of RE, the cost of equity, is ________%. Margin of error for correct responses: +/- .10%.

The last five annual dividends for BettsCorp have been: $1.29, $1.32, $1.44, $1.55, and $1.70. Next year's dividend is expected to be $2. The current stock price is $178 per share. First, calculate the geometric average annual rate of growth based on the historical dividends (taking into account the previous five -- do *not* include next year's expected dividend in this calculation). Your estimate of R_E, the cost of equity, is ________%.

Margin of error for correct responses: +/- .10%.