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frustelle frustelle
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7 months ago
The Third Cup Company has just paid a dividend of $3 per share. The dividends are expected to grow at a rate of 4% per year forever. The current stock price is $25 per share. The firm faces a tax rate of 40% and flotation costs of 5% on new stock issues. The cost of equity for new funds is

▸ 16.87%.

▸ 10.12%.

▸ 16.48%.

▸ 9.89%.
Textbook 
Corporate Finance

Corporate Finance


Edition: 5th
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mkql12mkql12
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7 months ago
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