Fastest Company's common shares are currently trading for $30. It is expected that Fastest Company will pay

Question:

Fastest Company's common shares are currently trading for $30. It is expected that Fastest Company will pay an annual common share dividend of $2 next year. It is also expected that the dividend will grow at a rate of 5 percent each year in perpetuity. Based on the constant growth dividend discount model, what is Fastest Company's cost of common equity?

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...