A Ltd. issued equity shares of ₹10 Lakh comprising of 1 lakh shares of ₹10 each. The current market price per share is ₹50 and current dividend paid is ₹5 per share. The dividend is expected to grow @ 5% per annum. On th

CS Executive · Financial and Strategic Management · PYQS · June 2022
A Ltd. issued equity shares of ₹10 Lakh comprising of 1 lakh shares of ₹10 each. The current market price per share is ₹50 and current dividend paid is ₹5 per share. The dividend is expected to grow @ 5% per annum. On the basis of dividend growth model, the cost of equity will be :
(A) 15%
(B) 15.2%
(C) 15.5%
(D) 16%

Answer & Explanation:

Correct Answer: Option (C)

Official answer key: (C).

Topics: Financial Management

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