Required earnings are the:
A) adjusted net income multiplied by the required rate of return on common equity capital.
B) net income the analyst expects the firm to generate multiplied by the required rate of return on common equity capital.
C) the market value of common equity capital at the beginning of the period multiplied by the required rate of return on common equity capital.
D) the book value of common equity capital at the beginning of the period multiplied by the required rate of return on common equity capital.

Question

Quizplus · Accepted Answer

Required earnings are calculated by multiplying the book value of common equity capital at the beginning of the period by the required rate of return on common equity capital.

Required Earnings Are The