Sutter Corporation's common stock is selling for $16.80 a share. Last year Sutter paid a dividend of $.80
Investors are expecting Sutter's dividends to grow at an annual rate of 5% per year. What is the cost of internal
equity?
What will be an ideal response?
D1 = $.80 × 1.05 = $.84
Cost of internal equity = $.84/$16.80 + .05 = 10%
You might also like to view...
The character of a company's culture is a NOT a product of
A. standards of what is ethically acceptable and what is not. B. organizational learning from past errant behavior on the part of executives and employees. C. core values and beliefs espoused by executives. D. the "chemistry" and the "personality" that permeate the work environment. E. its traditions and the stories that get told over and over.
The excess of issue price over par of common stock is termed a(n)
A) discount B) income C) deficit D) premium
The steps of John Kotter's approach to organizational change include all of the following except
A. develop a change vision. B. increase urgency. C. foster determination and persistence. D. refreeze to make the change stick. E. generate short-term wins.
A tenant's right to occupy property in a co-ownership varies with the type of tenancy
Indicate whether the statement is true or false