Last week, Lester's Electronics paid an annual dividend of $2.25 on its common stock. The company has
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Question:
Last week, Lester's Electronics paid an annual dividend of $2.25 on its common stock. The company has a longstanding policy of increasing its dividend by 3.5 percent annually. This policy is expected to continue. What is the firm's cost of equity if the stock is currently selling for $44.5 a share?
a. 11.9%
b. 9.86%
c. 12.04%
d. 8.73%
e. 10.5%
Related Book For
Foundations of Financial Management
ISBN: 978-1259024979
10th Canadian edition
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen, Doug Short, Michael Perretta
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