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Use the following information to answer the next two questions. Krackle Industries, Inc. management expects to pay a dividend of $4.20 next year (D=$4.20), currently
Use the following information to answer the next two questions. Krackle Industries, Inc. management expects to pay a dividend of $4.20 next year (D=$4.20), currently has a stock price of $75, and a growth rate of 5.6%. Krackle Industries stock has a beta of 1.2, as computed by a leading investment service. The present risk-free rate is 3.0 percent, and the expected return on the stock market is 12.0 percent. 4. Based on use of the CAPM approach what is Krackle's cost of common stock? (5 points) I
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