Cost of retained earnings

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The CEO of the Geurts Corporation wants to know what its Cost of Retained Earnings is, when there is the following information:

Rd = 4% Rf = 3.5%

Market Risk Premium = 4.5%

Beta = 0.8

Last Dividend = $1.80

Growth Rate = 4%

Current Stock Price = $40

a. 7.87% b. 7.79% c. 7.93% d. 7.73% e. 8.02%

Reference no: EM13925400

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