McCliffs has the following parameters related to its stock and firm. Beta Recent Dividend 1.1 Dividend Growth Rate Expected return on market Treasury Bills Yield Most recent stock price 1.05 dollars 4.5 percent 11.0 percent 4.3 percent 64.00 dollars What is the cost of equity using DDM? What is the cost of equity using SML? a. 6.21 percent b. 11.67 percent c. 6.01 percent d. 7.37 percent e. 4.5 percent f. 11.00 percent

Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter12: Fainancial Statement Analysis
Section: Chapter Questions
Problem 33MCQ: Selected information for Berry Company is as follows: Berrys return on equity rounded to the nearest...
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Financial accounting

McCliffs has the following parameters related to its
stock and firm.
Beta
Recent Dividend
1.1
Dividend Growth Rate
Expected return on market
Treasury Bills Yield
Most recent stock price
1.05 dollars
4.5 percent
11.0 percent
4.3 percent
64.00 dollars
What is the cost of equity using DDM? What is the
cost of equity using SML?
a. 6.21 percent
b. 11.67 percent
c. 6.01 percent
d. 7.37 percent
e. 4.5 percent
f. 11.00 percent
Transcribed Image Text:McCliffs has the following parameters related to its stock and firm. Beta Recent Dividend 1.1 Dividend Growth Rate Expected return on market Treasury Bills Yield Most recent stock price 1.05 dollars 4.5 percent 11.0 percent 4.3 percent 64.00 dollars What is the cost of equity using DDM? What is the cost of equity using SML? a. 6.21 percent b. 11.67 percent c. 6.01 percent d. 7.37 percent e. 4.5 percent f. 11.00 percent
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