DU recently paid a dividend of $1.60. An analyst expects that the firm's dividend rate will...

  

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DU recently paid a dividend of $1.60. An analyst expects that the firm's dividend rate will grow at a constant rate of 2% indefinitely. He also determines DU's beta is 1.4, the risk-free rate is 1.25%, and the expected return on the market is 7.5%. a. What is the cost of equity? Number % Round your answer to two decimals b. What is the current value of DU's shares? $ Number Round your answer to the nearest cent DU recently paid a dividend of $1.60. An analyst expects that the firm's dividend rate will grow at a constant rate of 2% indefinitely. He also determines DU's beta is 1.4, the risk-free rate is 1.25%, and the expected return on the market is 7.5%. a. What is the cost of equity? Number % Round your answer to two decimals b. What is the current value of DU's shares? $ Number Round your answer to the nearest cent