Determining cost of equity from retained earnings


Assume that Kish Inc. hired you as a consultant to help estimate its cost of capital. You have obtained the following data: D0 = $0.90; P0 = $30.00; and g = 7.00% (constant). Based on the DCF approach, what is the cost of equity from retained earnings?

9.60%

7.66%

11.33%

8.37%

10.21%

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Finance Basics: Determining cost of equity from retained earnings
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