Under the cgdm at what rate do you need to expect, Financial Management

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Under the cgdm at what rate do you need to expect

Mackenzie Company has a price of $32 and will issue a dividend of $2.00 next year. It has a beta of 1.2, the risk-free rate is 5.7%, and the market risk premium is estimated to be 5.1%.

a. Estimate the equity cost of capital for Mackenzie.

b. Under the CGDM, at what rate do you need to expect Mackenzie's dividends to grow to get the same equity cost of capital as in part (a)?

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Financial Management: Under the cgdm at what rate do you need to expect

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