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What will be the firm cost of equity using CAPM approach

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Question - The earnings, dividends, and stock price of Paras, Inc. are expected to grow at 7 percent per year after this year. Paras's common stock sells for P23 per share, its last dividend was P2.00 and will pay P2.14 at the end of the current year. Paras should pay P2.50 flotation cost. If the firm's beta is 1.75, the risk-free rate is 8 percent, and the average return on the market is 12 percent, what will be the firm's cost of equity using the CAPM approach?

Reference no: EM133040158

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