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    Cost of Equity

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    Please help with this capital asset pricing model problem. How would one determine the cost of equity?

    © BrainMass Inc. brainmass.com June 3, 2020, 10:35 pm ad1c9bdddf
    https://brainmass.com/business/capital-asset-pricing-model/cost-of-equity-problem-239558

    Solution Preview

    Cost of equity of a company can be determined using its Beta. Beta(equity) of a public company is published in a lot of places. One can use the CAPM to estimate the cost of equity of the firm.
    Cost of Equity = Risk free rate + Beta(Market Premium)
    Risk free ...

    Solution Summary

    Overall, an excellent response with a great amount of detail. The solution is very easy to understand and very well explained. The solution explains how to get the cost of equity for any company.

    $2.19

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