Stock in Eduardo Industries has a beta of 1.06. The market risk premium is 7.1 percent,...

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Stock in Eduardo Industries has a beta of 1.06. The market risk premium is 7.1 percent, and T-bills are currently yielding 4.1 percent. The most recent dividend was $3.00 per share, and dividends are expected to grow at an annual rate of 5.1 percent, indefinitely. If the stock sells for $52 per share, what is your best estimate of the company's cost of equity? Hint: The book assumes your best estimate is the average of what you calculate for cost of equity using the CAPM approach and the dividend growth model (DGM) approach. Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Answer is complete but not entirely correct. Cost of equity 11.16% 13 Stock in Eduardo Industries has a beta of 1.06. The market risk premium is 7.1 percent, and T-bills are currently yielding 4.1 percent. The most recent dividend was $3.00 per share, and dividends are expected to grow at an annual rate of 5.1 percent, indefinitely. If the stock sells for $52 per share, what is your best estimate of the company's cost of equity? Hint: The book assumes your best estimate is the average of what you calculate for cost of equity using the CAPM approach and the dividend growth model (DGM) approach. Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Answer is complete but not entirely correct. Cost of equity 11.16% 13