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Candy's Treehouse incurs flotation costs of4% whenever it chooses to issue new preferred stock. Your investment bank has advised you that any new issue ofpreferred would be required to pay a $3 dividend. Based on this dividend, the investment bank has also advised you to expect a selling price of $80. what is the after-tax cost of this proferred stock ifthe firm ces a tax rate of40%? 2 3 1 5 5 7 B 9 Tax Rate Price Dividend Flotation Flotation S 11 2 Before-Tax Cost 3 After-Tax Cost 0 TYPE OKAY! FORM+REF Type # or formula ok! 14 15 Candy's Trechoses incurs fotation costs of4% whenever it chooses to issue orw porked stock. Your investment bank has advised you that any new issue ofreened would be required to pay a 13 dividend. Based on this dividend, the intment bank has ales advised you to expect a selling price 580 this dered stock if the f the afer-tax est of 40% Question #3 6 pts Vor= FCF (1+WACC) WACC ware(1-7)+(1-7)++w D Tps = Pra (1-F) D PM +9 +9= - +9 Po(1-F) T=Tar+ (RPM) b b = PUM May MAKE SURE TO RENAME YOUR FILE NAME TO YOUR LAST