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Hatter Enterprise Paid a Dividend of $2 Last Year, Its

Question 133

Multiple Choice

Hatter Enterprise paid a dividend of $2 last year, its stock is selling at $45 per share, and a constant growth of 6% is expected. If Hatter's cost of new equity is 11.2%. Calculate the flotation costs associated with a new issue of common stock.


A) 8.8%
B) 9.4%
C) 10.2%
D) 11.6%

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