Question:5.9 McCliffs has the following parameters related to its stock and firm. Beta Recent Dividend 1.1 1.05 dollars Dividend Growth Rate 4.5 percent Expected return on market Treasury Bills Yield Most recent stock price 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?

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter11: Determining The Cost Of Capital
Section: Chapter Questions
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Question:5.9
McCliffs has the following parameters related to its stock and firm.
Beta
Recent Dividend
1.1
1.05 dollars
Dividend Growth Rate
4.5 percent
Expected return on market
Treasury Bills Yield
Most recent stock price
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?
Transcribed Image Text:Question:5.9 McCliffs has the following parameters related to its stock and firm. Beta Recent Dividend 1.1 1.05 dollars Dividend Growth Rate 4.5 percent Expected return on market Treasury Bills Yield Most recent stock price 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?
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