A company expects a 16% return on its equity share. The risk-free interest on government securities is 9% and the shares’ beta factor is 1.40. Calculate the cost of equity based on CAPM. A company has...

A company expects a 16% return on its equity share. The risk-free interest on government securities is 9% and the shares’ beta factor is 1.40. Calculate the cost of equity based on CAPM.

A company has issued only recently Rs 100 preference shares with an annual dividend of 10%. They are redeemable preference shares with a maturity of 10 years. Find the cost if floatation cost amounts to Rs 4 per share.