Using the dividend discount model, what is the cost of equity capital for Zeller Mining if the company will pay a dividend of C$2.30 next year, has a payout ratio of 30 percent, a return on equity (ROE) of 15 percent, and a stock price of C$45?

a. 9.61 percent.
b. 10.50 percent.
c. 15.61 percent.

Ans: c. 15.61 percent.

Business

You might also like to view...

Mom and Pop's Grocery is a sole proprietorship. Mom and Pop would like to establish a qualified plan to take advantage of the same tax advantages to which corporations are entitled. Mom and Pop should established:

a) 401(k) plan b) Simplified Employees Pension (SEP) c) Individual Retirement Account (IRA) d) Keogh (HR-10) plan

Business

A threat to bring a civil lawsuit unless someone enters into a contract constitutes duress

Indicate whether the statement is true or false

Business