The text identifies three methods for estimating the cost of common stock from retained earnings: the

1 answer
Question:

The text identifies three methods for estimating the cost of common stock from retained earnings: the capm method, the dcf method, and the bond-yield-plus-risk-premium method. however, only the capm method always provides an accurate and reliable estimate. true / false.

Answers

A. True

Explanation:

This is true, the estimate we get of the cost of common stock from retained earnings is not fully accurate. So we often use all three methods and then average out to use a reasonable estimate.

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