The earnings, dividends, and stock price of Stan Company are expected to grow at 7 percent per year after this year. Stan Company's common stock sells for P23 per share, its last dividend was P2.00 and the company pay P2.14 at the end of the current year. Stan Company should pay P2.50 flotation cost. Using the dividend growth model, what is the expected cost of retained earnings for Stan Company? Round off your final answer up to two decimal places.

The earnings, dividends, and stock price of Stan Company are expected to grow at 7 percent per year after this year. Stan Company's common stock sells for P23 per share, its last dividend was P2.00 and the company pay P2.14 at the end of the current year. Stan Company should pay P2.50 flotation cost. Using the dividend growth model, what is the expected cost of retained earnings for Stan Company? Round off your final answer up to two decimal places.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter7: Common Stock: Characteristics, Valuation, And Issuance

Section: Chapter Questions

Problem 3P

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