accepted? Explain. ets or only some of them. Which set of projects should be 10-6 COST OF COMMON EQUITY Callahan Technologies Inc. are expected to grow 6% per currently sells for $22.00 per share; its last dividend was $2.00, and it dividend at the end of the current year The future earnings, dividends, and common stock pric year. Callahan's common stock a. Using the DCF approach, what is its cost of common equity? b. If the firm's b eta is 1.2, the risk-free rate is 6%, and the average return on the market is 13%, what will be the firm's cost of common equity using the approach? If the firm's bonds earn a return of 11%, based on the bond-yield-plus-risk premium c. approach, what will be r,? Use the midpoint of the risk premium range discussed in Section 10-5 in your calculations d. If you have equal confidence in the inputs used for the three approaches, what is your estimate of Callahan's cost of common equity? COST OF COMMON EQUITY WITH AND WITHOUT FLOTATION The Evanec Company's next expected dividend, Di, is $3.18; its grow for $36.00. New stock (external equity) can be sold to net $32.40 per share. a. What is Evanec's cost of retained earnings, r,? b. What is Evanec's percentage flotation cost, F? 10-7 th rate is 6%, and its common stock now sells c. What is Evanec's cost of new common stock, re? ion has a target capital