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3. Wellsley Corporation has preferred stock outstanding. The stock has a 12% dividend rate. The stock's market price is $80 per share, and its par

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3. Wellsley Corporation has preferred stock outstanding. The stock has a 12% dividend rate. The stock's market price is $80 per share, and its par value is $75. If new shares are issued, the firm will pay $2 per share in flotation costs. The corporate tax rate is 21%. What is the firm's cost of preferred stock financing? a) 9.74% b) 9.12% c) 12.00% d) 12.33% e) 11.54%

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