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Cost of common stock equity Ross Textiles wishes to measure its cost of common stock equity. The firm's stock is currently selling for $47.22. The
Cost of common stock equity Ross Textiles wishes to measure its cost of common stock equity. The firm's stock is currently selling for $47.22. The firm expects to pay a $3.40 dividend at the end of the year (2016). The dividends for the past 5 years are shown in the following table: (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) Year 2015 2014 2013 Dividend per Share o $3.07 $2.77 $2.49 $2.19 $2.04 2012 2011 After underpricing and flotation costs, the firm expects to net $41.55 per share on a new issue. After underpricing and flotation costs, the firm expects to net $41.55 per share on a new issue. a. Determine the growth rate of dividends from 2011 to 2015. b. Determine the net proceeds, No, that the firm will actually receive. c. Using the constant-growth valuation model, determine the cost of retained earnings, rs. d. Using the constant-growth valuation model, determine the cost of new common stock, rp
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