Assume That You Are a Consultant to Broske Inc

question 13

Multiple Choice

Assume that you are a consultant to Broske Inc., and you have been provided with the following data: D1 = $0.67; P0 = $27.50; and g = 8.00% (constant) . What is the cost of equity from retained earnings based on the DCF approach?

• A) 9.42%
• B) 9.91%
• C) 10.44%
• D) 10.96%
• E) 11.51%

---

Definitions:

Occupied π Molecular Orbitals

π molecular orbitals that contain electrons; they are involved in bonding between atoms and are crucial for understanding the reactivity of molecules.

Cyclobutadiene

A highly unstable, conjugated diene with the molecular formula C4H4, characterized by a square planar structure that challenges classical bonding theories.

[4]annulene

A cyclic compound made up of four conjugated carbon atoms, known for its planar structure and aromatic behavior despite having 4 π-electrons, which does not follow Huckel's rule for aromatic stability.

Aromatic

Relates to organic compounds containing one or more planar ring structures with delocalized π-electrons, exhibiting unique stability and reactions.