Young’s Specialized Cruises plans to issue preferred stock at a price of $64 per share. The annual dividend will be $4.48 per share and issuance costs are expected to be $1.00 per share. What is the cost of raising funds with preferred stock for Young?
1.56%
6.89%
7.00%
7.11%
Cost of preferred stock = Dividend per share/(price - flotation cost)
= 4.48/(64-1)
= 7.11%
Young’s Specialized Cruises plans to issue preferred stock at a price of $64 per share. The...
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