Q1:
cost of equity with floatation cost = D1/P*(1-f) +g
where f=floatation cost
cost of equity with floatation cost=2.1/[23.2*(1-5%)] +.048 =14.328%
floatation cost adjustment=cost of equity with floatation cost- cost of equity without floatation cost
=14.328%-12% =2.328%
Q2:
cost of old equity +floatation cost = 11.5 +2.328 =13.828%
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