17. Sentry Manufacturing paid a dividend yesterday of $5 per share. The dividend is expected to grow at a constant rate of 8% per year. The price of Sentry Manufact stock today is $29 per share. If Sentry Manufacturing decides to issue new comm stock, flotation costs will equal $2.50 per share. Sentry Manufacturing's marginal rate is 35%. Based on the above information, the cost of new common stock is A) 28.38%. B) 24.12% C) 26.62% D) 31.40%. 18. A machine that costs $2,500,000 has a 3-year life. It will generate after-tax annual cas flows of $550,000 at the end of each year. It will be salvaged for $30,000 at the end of year 3. If your required rate of return for the project is 12%, what is the NPV of this investment? A) $1,157,639. CT nimeshbu yolynomo borben B) -$1,159,927 C) -$1,178,993 be D) $238,395 The risk-free rate of return is 2.5% and the market risk premium is 8%. Roque Transport has a beta of 22 and a standard deviation of returns of 28%. Rogue Transport's marginal tax rate is 35%. Analysts expect Rogue Transport's $1.57 in dividends last year to grow by 6% per year for the foreseeable future. Using the capital asset pricing model, what is Rogue Transport's cost of equity? A) 16.4% B) 17.7% C) 19.6% D) 20.1% 20. When reviewing the net present value profile for a project, A) the higher the discount rate, the higher the NPV. B) the higher the discount rate, the higher the IRR. C) the IRR will always be a point on the horizontal axis line where NPV = 0. D) the IRR will always be a point on the horizontal axis equal to the required return by the IRR well as his count rate, the higher the forma project