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Rebel Restaurant expects to pay a common stock dividend of $1.50 per share next year...

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Question

Accounting

Rebel Restaurant expects to pay a common stock dividend of $1.50 per share next year (d1). Dividends are expected to grow at a 3% rate for the foreseeable future.

The restaurants common stock is selling for $18 per share and issuance costs are $3 per share.

What is the restaurant's cost of external equity?

Group of answer choices

a. 14.00%

b. 13.00%

c. 12.11%

d. 20.59%

Answer & Explanation Solved by verified expert
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