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D Question 2 2 pts Builtrite Furniture is considering sells bonds for a plant expansion. Currently, Builtrite believes that it could sell 20 year maturity,

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D Question 2 2 pts Builtrite Furniture is considering sells bonds for a plant expansion. Currently, Builtrite believes that it could sell 20 year maturity, S1000 par value, 51/8% coupon bonds after flotation costs for $1060 If Builtrite is in the 34% marginal tax bracket, what is the after-tax cost for the bonds? 4.64% 0 3.44% O 3.06% 0 5.21% Question 3 2 pts Builtrite's common stock is currently selling for $42 a share and the firm just paid an annual dividend of $1.20 per share. Management believes that dividends and earnings should grow at 8% annually. Based on this, and a marginal tax rate of 34%, what is the cost of common stock (also known as the cost of retained earnings)? 11.10% 7.17% O 7.32% 10.86%

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