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samualson samualson
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5 years ago
The risk-free rate of return is 2.5% and the market risk premium is 8%. Rogue Transport has a beta of 2.2 and a standard deviation of returns of 28%. Rogue Transport's marginal tax rate is 35%. Analysts expect Rogue Transport's dividends to grow by 6% per year for the foreseeable future. Using the capital asset pricing model, what is Rogue Transport's cost of retained earnings?
A) 16.4%
B) 17.7%
C) 19.6%
D) 20.1%
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Foundations of Finance

Foundations of Finance


Edition: 9th
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Marc18Marc18
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