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You are estimating the cost of equity for the company's common stock using the constant dividend growth model. Your company is expected to pay a
You are estimating the cost of equity for the company's common stock using the constant dividend growth model. Your company is expected to pay a $0.80 cash dividend for the year. There has been a steady growth in dividends of 5% per year which analysts expect to continue. Current price is $22.40. Calculate the following returns: (1/100 of one percent without % sign, e.g. 12.671, if a negative percentage, -9.56) 1) Cost of capital - constant dividend growth model: Your company has a semi annual bond issue outstanding that matures in 7 years. The bond is quoted at 101.4 percent and coupon rate of 8%. What is the firm's before tax cost of debt if the tax rate is 30 percent? Calculate the following returns: (1/100 of one percent without % sign, e.g. 12.671, if a negative percentage, -9.56): 1) Cost of debt Your company has a semi annual bond issue outstanding that matures in 7 years. The bond is quoted at 101.4 percent and coupon rate of 8%. What is the firm's after tax cost of debt if the tax rate is 30 percent? Calculate the following returns: (1/100 of one percent without % sign, e.g. 12.671, if a negative percentage, -9.56) 1) Cost of debt
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