hi teacher please give me this question answer Financial accounting The future earnings, dividends, and common stock price ofCarpetto Technologies Inc. are expected to grow 11% per year.Carpetto's common stock currently sells for $23.00 per share; itslast dividend was $2.00; and it will pay a $2.14 dividend at the endof the current year.a) Using the DCF approach, what is its cost of common equity?b) If the firm's beta is 1.6, the risk-free rate is 9%, and the averagereturn on the market is 13%, what will be the firm's cost of commonequity using the CAPM approach?

Step 1: Define Cost Of EquityThe cost of equity refers to the financing cost of acquiring and using…

Answered: The future earnings, dividends, and…

Financial Management: Theory & Practice

16th Edition

ISBN:9781337909730

Author:Brigham

Publisher:Brigham

Chapter7: Corporate Valuation And Stock Valuation

Section: Chapter Questions

Problem 18MC

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