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Compute what is the cost of common equity

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Reference no: EM132558334

Cost of Equity: Dividend Growth:

Question 1: Summerdahl Resort's common stock is currently trading at $34.00 a share. The stock is expected to pay a dividend of $1.50 a share at the end of the year (D1 = $1.50), and the dividend is expected to grow at a constant rate of 4% a year. What is the cost of common equity? Round your answer to two decimal places.

Reference no: EM132558334

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