Which one of the following would tend to have the greatest effect on the cost of equity?

Question

Quizplus · Accepted Answer

The cost of equity is influenced by the growth rate of dividends. A higher growth rate of dividends would tend to increase the expected return on equity, which in turn would increase the cost of equity. Therefore, a 10% increase in the growth rate of a firm's dividends would have the greatest effect on the cost of equity.

Which One of the Following Would Tend to Have the Greatest