Firm cost of equity by using constant growth model


Using the constant growth model, a firm's expected (D1) dividend yield is 3% of the stock price, and it's growth rate is7%, if the tax rate is .35% what is the firm's cost of equity?

a. 10%

b. 6.65%

c. 8.95

d. More info required

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Finance Basics: Firm cost of equity by using constant growth model
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