Problem 10.06 – Callahan Technologies Inc.

Fundamentals of Financial Management, Concise

Brigham and Houston

09th Edition, 10th Edition, and 11th Edition

4.2
(5)

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Difficulty – Medium

Given the growth rate, stock price, last dividend, what the dividend will pay, beta, risk-free rate, and return on the market... find the cost of equity for each scenario using the DCF approach, the CAPM approach, and the bond-yield-plus-risk-premium approach.

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