Benton Industries stock has a beta of 1.2. The company just paid a dividend of $.50, and the dividends are expected to g

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Benton Industries Stock Has A Beta Of 1 2 The Company Just Paid A Dividend Of 50 And The Dividends Are Expected To G 1 (99.41 KiB) Viewed 49 times

Benton Industries stock has a beta of 1.2. The company just paid a dividend of $.50, and the dividends are expected to grow at 6 percent per year. The expected return on the market is 11 percent, and Treasury bills are yielding 6.2 percent. The current price of the company's stock is $79. a. Calculate the cost of equity using the DDM method. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. Calculate the cost of equity using the SML method. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. DDM method % b. SML method %