As a consultant to Basso Inc., you have been provided with the following data: D1 = $0.67; P0 = $27.50; and gL = 8.00% (constant). What is the cost of common from reinvested earnings based on the dividend growth approach?
A. 9.42%
B. 9.91%
C. 10.44%
D. 10.96%
E. 11.51%
Answer: C
Business
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