F14 Summary of Capital Cost Calculations I.The Cost of Equity, R E A.Dividend growth model approach R E = D 1 / P 0 + g B.SML approach R E = R f +  E  (R M - R f ) II.The Cost of Debt, R D A.For a firm with publicly held debt, the cost of debt can be measured as the yield to maturity on the outstanding debt.
{"Image DocumentName": "F3 Dividend Growth Model Approach", "Image ImageDescription": "Estimating the cost of equity: the dividend growth model approach. According to the constant growth model, D1. P0 = RE - g. Rearranging, RE = + g. P0.", "Image XResolution": "37", "Image YResolution": "37", "Image ResolutionUnit": "Pixels/Centimeter", "Image Software": "SlidePlayer", "Image YCbCrPositioning": "Centered"}