Essay
Aspen Industries currently pays an annual common stock dividend of $5.00 per share.The company's dividend has grown steadily over the past 10 years at a 7 percent rate and this rate is expected to continue for the foreseeable future.The company's stock currently sells for $70 per share.The company can issue new common stock at a net price of $65 per share. (a) Determine the firm's cost of internal equity capital using the dividend capitalization (constant-growth) model.
(b) Determine the firm's cost of external equity capital using the dividend capitalization (constant-growth) model.
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\[\begin{array} { l }
\mathrm { k } ...
View Answer
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