Sheepdog Rescue Just Paid Its First Annual Dividend of $1

question 21

Multiple Choice

Sheepdog Rescue just paid its first annual dividend of $1.95 a share.The firm plans to increase the dividend by 1.75 percent per year indefinitely.What is the firm's cost of equity if the current stock price is $31.45 per share?

• A)6.31 percent
• B)8.06 percent
• C)10.38 percent
• D)4.93 percent
• E)5.94 percent