Which one of the following statements related to the SML approach to equity valuation is correct? Assume the firm uses debt in its capital structure.

Question options:

This model considers a firm's rate of growth

The model applies only to non$-$dividend paying firms

The model is dependent upon a reliable estimate of the market risk premium

The model generally produces the same cost of equity as the dividend growth model

This approach generally produces a cost of equity that equals the firm's overall cost of capital