QUESTION 1 You have the following data: IRF = 1.50% RPM = 8.00%; and b=0.80. What is the cost of equity from retained earnings based on the CAPM approach? O A. 7.50% OB. 8.00% O C.7.90% OD 6.70% QUESTION 2 If D1 = $1.40. g (which is constant) = 2.5%, and PO = $60, what is the stock's expected capital gains yield for the coming year? O A. 2.50% O B.4.83% O C.2.00% OD.2.33% QUESTION 3 Hettenhouse Company's perpetual preferred stock sells for $103.00 per share, and it pays a $7.50 annual dividend. If the company were to sell a new preferred issue, it would incur a flotation cost of 5.00% of the price paid by investors. What is the company's cost of preferred stock for use in calculating the WACC? O A. 7.66% OB.8.23% O C.7.50% OD.7.28% QUESTION 4 LePage Co. expects to earn $2.20 per share during the current year, its expected payout ratio is 55%, its expected constant dividend growth rate is 4.5%, and its common stock currently sells for $26.00 per share. New stock can be sold to the public at the current price, but a flotation cost of 2.5% would be incurred. What would be the cost of equity from new common stock? O A. 9.15% OB.9.27% O C. 8.45% O D. 9.70%