It is also expected that the dividend will grow at a rate of 5 percent each year in perpetuity. Based on the constant growth dividend discount model, what is Fastest Company’s cost of common equity?

Fastest Company’s common shares are currently trading for $30. It is expected that Fastest Company will pay an annual common share dividend of $2 next year. It is also expected that the dividend will grow at a rate of 5 percent each year in perpetuity. Based on the constant growth dividend discount model, what is Fastest Company’s cost of common equity?

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