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Suppose that your company is expected to pay a dividend of $1.50 per share next...

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Accounting

Suppose that your company is expected to pay a dividend of $1.50 per share next year. There has been a steady growth in dividends of 4% per year and the market expects that to continue. The current price is $20. What is the cost of equity?

A.

11.5%
B.

11.8%
C.

4%

D.

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