Page 34 - F2 Integrated Workbook STUDENT 2019
P. 34
Chapter 2
Example 2.4
The ordinary shares of Ranieri are quoted at $6.00 cum div. A dividend of 75c is
just about to be paid. The company has an annual return of reinvested funds of
10% and each year pays out 60% of its profit after tax as dividends.
Required
Calculate the cost of equity. Give your answer to 2 decimal places.
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