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A firm needs to issue some stocks for a project. It just paid a dividend of $3 per share, and the next dividend will
A firm needs to issue some stocks for a project. It just paid a dividend of $3 per share, and the next dividend will be paid in exactly one year. Its dividend is expected to grow at 5% forever, and current stock is trading at $50 per share. Suppose the flotation cost is 1%, what is the cost of new equity?
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The cost of new equity can be calculated using the Gordon Growth Model and t...
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Corporate Finance
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe
13th International Edition
1265533199, 978-1265533199
