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Chelsea Fashions is expected to pay an annual dividend of $1.10 a share next year....

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Accounting

Chelsea Fashions is expected to pay an annual dividend of $1.10 a share next year. The market price of the stock is $27.00 and the growth rate is 3 percent. What is the firm's cost of equity?

6.95 percent

6.89 percent

7.12 percent

7.07 percent

6.76 percent

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