Arphexad Corporation is estimating its cost of common stock financing. Arphexad recently paid a $3.00 per share dividend, and financial analysts are forecasting that the dividend will grow at a rate of 10% for the foreseeable future. The company's stock is currently selling for $65/share. Arphexad's investment bankers have advised that a new stock issue would incur flotation costs of 8% (based on market value) of the issue.

Reference: Ref 10-10

Determine the cost of a new stock issue to Arphexad Corporation.

Group of answer choices

15.52%.

15.98%.

14.04%.

16.92%.