Expected Return on Stock Investment. By using the dividend growth model, estimate the cost of equity capital for a firm with a stock price of $30, an estimated dividend at the end of the first year of...

Expected Return on Stock Investment. By using the dividend growth model, estimate the cost of equity capital for a firm with a stock price of $30, an estimated dividend at the end of the first year of $3.00 per share, and an expected growth rate of 10 percent. (CFM adapted.)