Calculate the cost pf common equity using gordon model

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Last year black water inc paid dividends $2.58. Companys dividends are expected to grow at an annual rate of 2.88 percent, forever. The companys common stock is currently selling in the market for $98.95.The investment banker will charge floatation costs 4.32 per share. Calculate the cost pf common equity using gordon model.

a. 5.68 %

b.19.58

c. 15.98

c.12.44

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Reference no: EM13728681

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