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Realized Yield Approach

Realized Yield Approach:

It is the easy method for calculating cost of equity capital. Under this method, cost of equity is calculated on the basis of return actually realized by the investor in a company on their equity capital.

Ke = PVf × D

finance
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Where,

Ke = Cost of equity capital.

PVƒ = Present value of discount factor.

D = Dividend per share.

Realized Yield Approach Realized Yield Approach Reviewed by Ikpokolo Francis on Sunday, April 30, 2017 Rating: 5

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