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borteleto borteleto
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5 years ago
Johnson Production Company paid a dividend yesterday of $3.50 per share. The dividend is expected to grow at a constant rate of 10% per year. The price of KayCee's common stock today is $40 per share. If KayCee decides to issue new common stock, flotation costs will equal $4.00 per share. KayCee's marginal tax rate is 35%. Based on the above information, the cost of retained earnings is
A) 26.41%.
B) 20.09%.
C) 19.63%.
D) 17.55%.
Textbook 
Foundations of Finance

Foundations of Finance


Edition: 9th
Authors:
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DeanaRayDeanaRay
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borteleto Author
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5 years ago
This calls for a celebration Person Raising Both Hands in Celebration
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