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Assume that you are a consultant to Broske Inc., and you have been provided with the...

Assume that you are a consultant to Broske Inc., and you have been provided with the following data: The company pays a fixed annual dividend of $4.8 per share and its current stock price is $50. The company is operating in a mature industry and not expected to grow at all. What is the cost of equity for the company?

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Answer #1

cost of equity is equal to=Annual dividend/Current price

=(4.8/50)

which is equal to

=9.6%

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