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Current cost of common equity for the firm

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Carla Vista Inc.'s common shares currently sell for $30 each. The firm's management believes that its shares should really sell for $54 each. The firm just paid an annual dividend of $2 per share and management expects those dividends to increase by 8 percent per year forever (and this is common knowledge to the market).

What is the current cost of common equity for the firm? (Round final answer to 2 decimal places, e.g. 15.25%.)

Reference no: EM132402901

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