What is JJ’s cost of equity?

JJ’s current share price is $1.80, with a dividend of $0.20 a share just about to be paid.

Dividends have increased at an average annual growth rate of 4.5% and this is expected to continue into the future.

What is JJ’s cost of equity?
A . 17.6%
B . 16.1%
C . 12.5%
D . 11.1%

View Answer

Answer: A