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The Cost of Equity Capital for a New Common Stock

Question 21

Multiple Choice

The cost of equity capital for a new common stock issuance can best be described as:

A) k_n= [D₁/(P_o-F) ] + g
B) k_n= [D₁/(P_o+F) ] + g
C) k_n= [D₁/(P_o+F) ] - g
D) k_n= (D₁+g) /(P_o+F)

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