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Cybersecure Corp. can sell common stock for $30 per share and its investors require a 12% return. However, the administrative or flotation costs associated with
Cybersecure Corp. can sell common stock for $30 per share and its investors require a 12% return. However, the administrative or flotation costs associated with selling the stock amount to $2.00 per share. What is the cost of capital for Cybersecure if the corporation raises money by selling common stock? 12.86% 18.67%, or 12% plus the flotation costs of 6.67% ($2/$30) 13.85% 12%, because that is what the shareholders demand
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