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Which of the Following Factors in the Discounted Cash Flow D~1P0\frac { \tilde { \mathrm { D } } _ { 1 } } { \mathrm { P } _ { 0 } }

Question 25

Multiple Choice

Which of the following factors in the discounted cash flow (DCF) approach to estimating the cost of common equity is the least difficult to estimate?


A) Expected growth rate, g
B) Dividend yield, D~1P0\frac { \tilde { \mathrm { D } } _ { 1 } } { \mathrm { P } _ { 0 } }
C) Required return, rs
D) Expected rate of return, r^s\hat { r } _ { s }
E) All of the above are equally difficult to estimate.

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