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    Foundations of Financial Management Study Set 1
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    Exam 11: Cost of Capital
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    Expected Cash Dividends Are $4
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Expected Cash Dividends Are $4

Question 98

Question 98

Multiple Choice

Expected cash dividends are $4.50,the dividend yield is 8%,flotation costs are 5%,and the growth rate is 4%.Compute cost of the new common stock.


A) 13.00%
B) 12.63%
C) 8.42%
D) 4.21%

Correct Answer:

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