Question
A firm has issued 8% preferred stock, which sold for $100 per share par value. The flotation costs of the stock equaled $3 and the
A firm has issued 8% preferred stock, which sold for $100 per share par value. The flotation costs of the stock equaled $3 and the firms marginal tax rate is 40%. The cost of the preferred stock is;
- 8.25%
- 8.00%
- 7.67%
- please explain the problem as well so that I can immediately do the problem as well. Please and Thank you
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Investment Analysis and Portfolio Management
Authors: Frank K. Reilly, Keith C. Brown, Sanford J. Leeds
11th Edition
1305262999, 1305262997, 035726164X, 978-1305262997
