1) (Cost of equity) Brille Corporation is issuing new common stock at a market price of $ 27 Dividends last year were $ 1.35 and are expected to grow at an annual rate of 7 percent forever. Flotation costs will be 11 percent of market price. What isBrille's cost ofequity?

a) Brille's cost of external common equity is ____%. (Round to two decimalplaces.)

2) (Cost of preferred stock) Your firm is planning to issue preferred stock. The stock sells for $111 however, if new stock isissued, the company would receive only $94.35 The par value of the stock is $ 100, and the dividend rate is 12 percent. What is the cost of capital for the stock to yourfirm?

a) The cost of capital for the preferred stock to your firm is ____%. (Round to two decimalplaces.)

3) (Individual or component costs of capital) Compute the costs for the following sources offinancing:

a. A $1,000 par value bond with a market price of $ 960 and a coupon interest rate of 6 percent. Flotation costs for a new issue would be approximately 6 percent. The bonds mature in 13 years and the corporate tax rate is 38 38 percent. ___% (Round to two decimalplaces.)

b. A preferred stock selling for $ 109 with an annual dividend payment of $ 9 The flotation cost will be $5 per share. Thecompany's marginal tax rate is 30 percent. ____ (Round to two decimalplaces.)

c. Retained earnings totaling $ 4.8 million. The price of the common stock is $ 71 pershare, and dividend per share was $ 9.21 last year. The dividend is not expected to change in the future. ____ (Round to two decimalplaces.)

d. New common stock for which the most recent dividend was $ 3.44 Thecompany's dividends per share should continue to increase at a growth rate of 11 percent into the indefinite future. The market price of the stock is currently $ 63 however, flotation costs of $ 8 per share are expected if the new stock is issued. ____ (Round to two decimalplaces.)