Jumbuck Exploration Has a Current Stock Price of $2

question 35

Multiple Choice

Jumbuck Exploration has a current stock price of $2.00 and is expected to sell for $2.10 in one year'stime, immediately after it pays a dividend of $0.26. Which of the following is closest to Jumbuck Exploration's equity cost of capital?

• A) 12%
• B) 22%
• C) 9%
• D) 18%

---

Definitions:

Top-down Communication

A method of information flow where decisions and information are passed from higher levels of an organization to lower levels.

Egalitarian Climate

A work environment where all employees are given equal respect and opportunities, regardless of their status or job role.

Departments Expand

The process of a company or organization increasing the size, scope, or number of its divisions.

Specialized

Pertains to a specific area of expertise or focus within a larger field.