Randon house current eps is 6.50. It was 4.42 five years ago. The company pasy out 40% of its earnings as divedends and the stock sells for $36.00
a. Calculate the historical growth rate in earnings ( hint 5 years)
b. Calculate the next expected dividend per hsare, D1(hint d0= 0.4(6.50= 2.60) Assume that the past growth rate will continue.
C. What is randon cost of equity.