1. Newmass, Inc. paid a cash dividend to its common shareholders over the past 12 months of P2.20 per share. The current market value of the common stock is P40 per share, and investors are anticipating the common dividend to grow at a rate of 6% annually. The cost to issue new common stock will be 5% of the market value. The cost of a new common stock issue will be?

2. Assume that you are the financial staff of Vanderheiden Inc., and you have collected the following data: the yield on the companys outstanding bonds is 7.75%, its tax rate is 40%, the next expected dividend is P0.65 a share, the dividend is expected to grow at a constant rate of 6.00% a year, the price of the stock is P15.00 per share, the flotation cost for selling new shares is F = 10%, and the target capital structure is 45% debt and 55% common equity. What is the firm's WACC, assuming it must issue new stock to finance its capital budget?