Given That Shares Have an Expected Dividend Stream of 10

question 6

Multiple Choice

Given that shares have an expected dividend stream of 10 cents in perpetuity and that the current market price of the shares is $2.40,calculate the cost of equity capital of these shares.

• A)8%
• B)12%
• C)10%
• D)4.2%

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Definitions:

PR Campaign

An intentional process of communication designed to foster mutually rewarding relationships between groups and their stakeholders.

PR

Short for Public Relations, it involves managing and distributing information between an individual or an organization and the public to shape perceptions and maintain a positive reputation.

Page Principles

A set of guidelines created by Arthur W. Page to define the roles and behaviors of effective public relations practice.

Arthur W. Page

A prominent figure in public relations history, known for establishing corporate communications principles and serving as a VP for AT&T.