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Calculate the cost of equity

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The expected return on the market is 11 percent. The common stock of Trompeta Inc. has a beta of 1.20 and the company just paid an annual dividend of $.50. Trompeta Inc.'s dividends are expected to grow indefinitely at 6 percent annually, and the most recent stock price for the company is $69.

Calculate the cost of equity. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Reference no: EM132288881

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