Question 9 Assume that ABC Inc. You have obtained the following data: D 0 = $0.90; P 0 = $30.00; and g = 6.00% (constant).

Question 9

Assume that ABC Inc. hired you as a consultant to help estimate its cost of capital. You have obtained the following data: D0 = $0.90; P0 = $30.00; and g = 6.00% (constant). Based on the DCF approach, what is its cost of equity?

1.9.18%

2.7.66%

3.11.33%

4.8.37%

5.9.60%