The cost of common stock equity may be estimated by using which of the following?

Name: The cost of common stock equity may be estimated by using which of the following?
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Question

Quizplus · Accepted Answer

The cost of common stock equity is best estimated using the Capital Asset Pricing Model (CAPM). This model takes into account the risk-free rate of return, market risk premium, and beta of the company to determine the expected return on the company's stock.

The Cost of Common Stock Equity May Be Estimated by Using