How do calculate the cost of equity capital using capm

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Problem 1: Calculate the cost of equity capital using CAPM if the risk-free rate of interest is 5 per cent, the return on the market portfolio is 9 per cent, the beta of the firm's assets is .8 and the and beta of equity is 1.2. Provide your answer as a percentage to two decimal places (15.32% should be entered as 15.32). Do not enter the % sign.2,Assume that A limited paid a dividend of 23.2 cents per share just recently. The shares currently sell for $10.9. You also estimate that the dividend will grow steadily at 2.1 % per year into the indefinite future. What is the cost of capital, ke for A limited?

Reference no: EM132709822

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