3. Pure Michigan also issued Common Stocks. - Common Stocks were sold at $57.61 per share but had to pay 8.0% in flotation expenses. - A total of 104,149 shares are outstanding. - Dividend just paid =$3.53 - Dividend Payout ratio =40.0% - ROE: 8.33% What is the cost of equity? Proceeds=P0(1f)"g"=ROE(1Payout)D1=D0(1+g)R5=(D1P0(1f))+g 4. What is Pure Michigan's Cost of Capital (WACC)? Their marginal tax rate =30.0%