Solution-
Current price (P0)= $39
Growth rate (g)=9%
Dividend yield=6%
Next Expected dividend (D1)= $39*6%= $2.34
Flotation cost (F) =15%
Cost of new equity = D1/P0(1-F) + g
Cost of new equity = 2.34/39(1-0.15) + 0.09= 16.06%
Points given for fast correct answers thank you! ently sells for $39.00 per share. The growth...
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