Question: Rivoli Inc. hired you as a consultant to help estimate its cost of common equity. You have been provided with the following data: D0= $0.80; P0= $22.50; and g = 8.00% (constant). Based on the DCF approach, what is the cost of common from common equity assuming no flotation costs?
Question: Fitzgerald Computers is considering a new project whose data are shown below. The required equipment has a 3-year tax life, after which it will be worthless, and it will be depreciated by the straight-line method over 3 years. Revenues and other operating costs are expected to be