Bonds: Builtrite is planning on offering a $1000 par value, 20 year, 5% coupon bond with an expected selling price of $1025. Flotation costs would be $55 per bond.

Preferred Stock: Builtrite could sell a $46 par value preferred with a 5% coupon for $38 a share. Flotation costs would be $4 a share.

Common stock: Currently, the stock is selling for $62 a share and has paid a $3.82 dividend. Dividends are expected to continue growing at 11%. Flotation costs would be $3.75 a share and builtrite has $350,000 in available retained earnings. assume a 30% tax bracket.

their after-tax cost of internal common (retained earnings) is:

18.43% 17.84% 17.48% 17.24%