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    Cost of Equity

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    Assume that you are a consultant to Broske Inc., and you have been provided with the following data: D1 = $1.30; P0 = $42.50; and g = 7.00% (constant). What is the cost of equity from retained earnings based on the DCF approach?

    A. 9.08%
    B. 9.56%
    C. 10.06%
    D. 10.56%
    E. 11.09%

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    Solution Summary

    The solution explains how to calculate the cost of equity