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Author Question: Ben's Ice Cream just paid their annual dividend of $.75 a share. The stock has a market price of $32 ... (Read 50 times)

student77

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Question 1

A firm's pre-tax cost of debt is 10%. If the firm is of average risk, what is the cost of equity using the bond yield plus premium approach?
◦ 15%
◦ 13%
◦ 14%
◦ 10%
◦ 11%

Question 2

Ben's Ice Cream just paid their annual dividend of $.75 a share. The stock has a market price of $32 and a beta of .90. The return on the U.S. Treasury bill is 4 percent and the market has a 12 percent rate of return. What is the cost of equity?
◦ 7.24 percent
◦ 8.67 percent
◦ 11.20 percent
◦ 12.92 percent
◦ 14.80 percent


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Marked as best answer by student77 on Apr 25, 2021

Animal_Goddess

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student77

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Reply 2 on: Apr 25, 2021
YES! Correct, THANKS for helping me on my review


mochi09

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Reply 3 on: Yesterday
:D TYSM

 

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