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Caribe's common stock sells for $42.50, and dividends paid last year were $1.28. Flotation costs on issuing stock will be 10% of the market price.

Caribe's common stock sells for $42.50, and dividends paid last year were $1.28. Flotation costs on issuing stock will be 10% of the market price. The dividends and earnings per share are predicted to have a 10% growth rate. What is the cost of internal equity for Caribe?

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