Issued dividend-what is the company cost of equity

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Reference no: EM131575599

The Down and Out Co. just issued a dividend of $2.16 per share on its common stock. The company is expected to maintain a constant 5 percent growth rate in its dividends indefinitely. If the stock sells for $35 a share, what is the company's cost of equity? (Do not round your intermediate calculations.)

a.) 10.91%

b.) 6.62%

c.) 12.05%

d.) 11.48%

e.) 11.17%

Reference no: EM131575599

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