Problem:
Martin Industries just paid an annual dividend of $2.40 a share. The market price of the stock is $28.30 and the growth rate is 7.4 percent.
Required:
Question: What is the firm's cost of equity?
- 6.88 percent
- 15.37 percent
- 39.62 percent
- 17.73 percent
- 16.51 percent
Note: Please show how you came up with the solution.