CIMA Exam CIMAPRA19-F02-1 Topic 5 Question 100 Discussion

Actual exam question for CIMA's CIMAPRA19-F02-1 exam

Question #: 100
Topic #: 5

[All CIMAPRA19-F02-1 Questions]

JJ's current share price is $1.80,with a dividend of $0.20 a share just about to be paid.

Dividends have increased at an average annualgrowth rate of 4.5% and this is expected to continue into the future.

What is JJ'scost of equity?

A17.6%

B16.1%

C12.5%

D11.1%

Show Suggested Answer

Suggested Answer: A

by Gail at Sep 19, 2024, 04:57 PM

Limited Time Offer

25%

Off

Get Premium CIMAPRA19-F02-1 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Melina

2 months ago

I don't know, I'm just hoping I can get a C and pass this exam. Who needs to know the cost of equity anyway? I'll be a professional meme connoisseur.

upvoted 0 times

Brent

7 days ago

User 4: I think it might be D) 11.1%

upvoted 0 times

...

Delfina

10 days ago

User 3: I'll go with C) 12.5%

upvoted 0 times

...

Ryan

15 days ago

User 2: I'm not sure, maybe it's B) 16.1%

upvoted 0 times

...

Billye

17 days ago

User 1: I think the answer is A) 17.6%

upvoted 0 times

...

Heike

2 months ago

This question is a piece of cake! Anyone who's been paying attention in class should be able to solve this in their sleep.

upvoted 0 times

...

Page

2 months ago

I'm going with A) 17.6%. That's the highest option, and it seems to make sense with the given information.

upvoted 0 times

Marge

28 days ago

User4: I think D) 11.1% is the right answer.

upvoted 0 times

...

Gerald

1 months ago

User3: I'll choose C) 12.5%.

upvoted 0 times

...

Alfred

1 months ago

Yeah, A) 17.6% seems like the most reasonable option based on the information provided.

upvoted 0 times

...

Cherry

1 months ago

I agree, A) 17.6% makes sense given the growth rate of dividends.

upvoted 0 times

...

Carli

1 months ago

User2: I'm going with A) 17.6%.

upvoted 0 times

...

Thaddeus

1 months ago

I think it's B) 16.1%.

upvoted 0 times

...

Luz

2 months ago

I think it's A) 17.6%, that seems like the best choice.

upvoted 0 times

...

Xuan

3 months ago

I'm leaning towards C) 12.5% because of the steady growth rate of dividends

upvoted 0 times

...

Gracia

3 months ago

I disagree, I believe the answer is B) 16.1%

upvoted 0 times

...

Willow

3 months ago

D) 11.1% seems too low. With a 4.5% dividend growth rate, the cost of equity should be higher than that.

upvoted 0 times

...

Salena

3 months ago

I think the answer is B) 16.1%. The dividend growth rate is 4.5%, so the cost of equity should be around 16.1%.

upvoted 0 times

Ronald

1 months ago

Yes, those factors are important too, but the growth rate has a significant impact on the cost of equity.

upvoted 0 times

...

Kattie

1 months ago

But don't we also need to consider the current share price and dividend amount?

upvoted 0 times

...

Sophia

2 months ago

I agree, the dividend growth rate is a key factor in determining the cost of equity.

upvoted 0 times

...

Vicki

2 months ago

I think the answer is B) 16.1%. The dividend growth rate is 4.5%, so the cost of equity should be around 16.1%.

upvoted 0 times

...

Daniela

3 months ago

I think the answer is A) 17.6%

upvoted 0 times

...