MSB Ltd has a current share price of $14.55.If MSB has a constant expected growth rate of 5% and is expected to pay a dividend of $0.65 per share,what is MSB's cost of capital?

Name: MSB Ltd has a current share price of $14.55.If MSB has a constant expected growth rate of 5% and is expected to pay a dividend of $0.65 per share,what is MSB's cost of capital?
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Question

Quizplus · Accepted Answer

Using equation 11.10,we can estimate the cost of capital as follows:

MSB Ltd Has a Current Share Price of $14 9.47% 9.47 \% 9.47%

MSB Ltd Has a Current Share Price of $14 $9.47 \%$