Satisfied by dividend yield and how much by capital gain

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Reference no: EM131554790

Anle Corporation has a current stock price of $20.00 and is expected to pay a dividend of $1.00 in one year. Its expected stock price right after paying that dividend is $22.00.

a. What is Anle's equity cost of capital?

b. How much of Anle's equity cost of capital is expected to be satisfied by dividend yield and how much by capital gain?

Reference no: EM131554790

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