l @ [ M ViewAssessment X ol 6075docx sa=is G https://bb.wpunj.edu/ultra/courses/_36042_1/grades/assessment/_2019137_1/overview/attempt/ 5266672_1?courseld=_36042 1 = Tomorrow's high Near record Table B A firm has determined its optimal structure which is composed of the following sources and farget market value proportions. Target Market Source of Capital Proportions Long-term debt 60 Common stock equity 40 Debt: The firm can sell a 15-year, $1,000 par value, 8 percent bond for $1,050. A flotation cost of 2 percent of the face value would be required in addition te the premium of $50. Common Stock: A firm's common stock is currently selling for $75 per share. The dividend expected to be paid at the end of the coming year is $5. Its dividend payments have been growing at a constant rate for the last five years. Five years ago, the dividend was $3.10. It is expected that to sell, a new common stock issue must be underpriced $2 per share and the firm must pay $1 per share in flotation costs. Additionally, the firm has a marginal tax rate of 40 percent 32 The firm's after-fax cost of debt is (See Table B) A) 4.6 percent B) 6 percent C) 7 percent D) 7.7 percent 33 The firm's cost of a new issue of common stock is (See Table B) A) 10.2 percent B) 14.3 percent C) 16.7 percent D) 17.0 percent 34. The firm's cost of retained eamings is (See Table B) A) 10.2 percent B) 14.3 percent .= Q Search '!:v | = T : a @ A Grading Maximum points w8 @ i 200 points 11:12 PM 5/9/2024 ! T @ & 8 B 9 " i = B B & Lili View Assessment X W 6075.docx X + X C @ https://bb.wpunj.edu/ultra/courses/_36042_1/grades/assessment/_2019137_1/overview/attempt/_5266672_1?courseld=_36042_1 . . . B) 6 percent C) 7 percent X D) 7.7 percent 33. The firm's cost of a new issue of common stock is (See Table B) G A) 10.2 percent B) 14.3 percent W C) 16.7 percent D) 17.0 percent y! 34. The firm's cost of retained earnings is (See Table B) A) 10.2 percent B) 14.3 percent in -0 ) C) 16.7 percent W D) 17.0 percent 35. The weighted average cost of capital up to the point when retained earnings are exhausted is (See Table B) A) 6.8 percent GW B) 7.7 percent C) 9.44 percent D) 11.29 percent . . . . . + Save and Close Submit Tomorrow's high 11:13 PM myhp Near record Q Search L 5/9/2024