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Company just issued a dividend of $1.60 per share on its stock. The company is expected...

Company just issued a dividend of $1.60 per share on its stock. The company is expected to have a constant 5 percent growth rate in dividends. Use the constant growth model from chapter 7. Yes the class material builds on itself. Required: If the stock sells for $40 a share, what is the company’s cost of equity? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

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