There is a stock that is currently trading at $20.16. Yesterday the stock paid an annual dividend of $1. You anticipate that the price will increase by 13% during the year, and that next year's annual dividend will be 15% greater than the one just received. What is the equity cost of capital for one year?

Answer rating: 100% (QA)

To calculate the equity cost of capital also known as the cost of equity we can use the dividend dis... View the full answer