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    Cost of equity from retained earnings

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    16. Assume that Kish Inc. hired you as a consultant to help estimate its cost of capital. You have obtained the following data: D0 = $0.90; P0 = $22.50; and g = 7.00% (constant). Based on the DCF approach, what is the cost of equity from retained earnings?
    10.60%
    8.80%
    11.28%
    11.17%
    9.93%

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    Solution Summary

    The solution explains the calculation of cost of equity from retained earnings

    $2.19