Homework: Chapter 9. The Cost of Capital Question 8, P9-11 (book/static) Part 1 of 2...
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Homework: Chapter 9. The Cost of Capital Question 8, P9-11 (book/static) Part 1 of 2 HW Score: 0%, 0 of 15 points O Points: 0 of 1 Save Next question Retained earnings versus new common stock Using the data for a firm shown in the following table, calculate the cost of retained earnings and the cost of new common stock using the constant-growth valuation model. (Click on the icon here 2 in order to copy the contents of the data table below into a spreadsheet.) Current market price per share $50.00 Dividend growth rate 8% Projected dividend per share next year $2.25 Underpricing per share $2.00 Flotation cost per share $1.00 a. The cost of retained earnings is 10% (Round to two decima places)
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