Multiple Choice
An all-equity firm produced a dividend flow of $20,000 last year.The market value of the firm is $650,000 and the dividend is expected to increase at 4% each year.What is the cost of equity capital for this firm?
A) 5.5%
B) 6.2%
C) 7.2%
D) 7.8%
E) 8.1%
Correct Answer:
Verified
Correct Answer:
Verified
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