A stock sells for $20 per share, its last dividend (D₀) was $1.00, and its growth rate is a constant 6%. What is its cost of common stock?

	5.3%
	11.0%
	11.3%
	11.6%

If a firms before-tax cost of debt is 10% and the firm has a 35% marginal tax rate, what is the firms after-tax cost of debt?

	6.5%
	3.5%
	10.0%
	None of above is correct.

A company has preferred stock that can be sold for $100 per share. The preferred stock pays an annual dividend $5. Therefore, the cost of preferred stock is:

	5.67%
	5.0%
	9.43%
	10.0%

A firm has a target capital structure of 30% debt, 20% preferred stock, and 50% common equity. The company's after-tax cost of debt is 5%, its cost of preferred stock is 8%, and its cost of retained earnings is 12%. What is the company's weighted average cost of capital if retained earnings are used to fund the common equity portion?

	8.0%
	9.50%
	9.10%
	10.80%.