IBM expects to pay a dividend of $2 next year and expects these dividends to grow at 7% a year. The price of IBM is $95 per share. What is IBM's cost of equity capital? A. 8.19% B. 7.28% C. 9.11% D. 8.65%
IBM expects to pay a dividend of $2 next year and expects these dividends to grow at 7% a year. The price of IBM is $95 per share. What is IBM's cost of equity capital? A. 8.19% B. 7.28% C. 9.11% D. 8.65%
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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![IBM expects to pay a dividend of $2 next year and expects these dividends to grow at 7% a year. The price of IBM is $95 per share. What is IBM's cost of equity
capital?
A. 8.19%
B. 7.28%
C. 9.11%
D. 8.65%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1890e4cf-0d68-442f-a020-6896474b9f32%2F69acfc0c-9eef-433d-83ea-4ab48297b596%2Fl3sw2am.png&w=3840&q=75)
Transcribed Image Text:IBM expects to pay a dividend of $2 next year and expects these dividends to grow at 7% a year. The price of IBM is $95 per share. What is IBM's cost of equity
capital?
A. 8.19%
B. 7.28%
C. 9.11%
D. 8.65%
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