Question:
Assume that the equity beta for JJ is 0.55. The Yield on 10-year tresuries is 3%, and that the market risk premium for the year is 6%.
What is the cost of equity for JJ?"
Currently the dividends for JJ firm are the same for common and preferred stock, but the growth rate for common stock dividends are expected to grow at a 3% rate. Its current common stock price is $27.
What is the cost of equity for JJ firm?"