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Dean Corporation has a marginal tax rate of 34%. The firm recently paid a dividend of $4.25 per share to its common stockholders. Earnings and
Dean Corporation has a marginal tax rate of 34%. The firm recently paid a dividend of $4.25 per share to its common stockholders. Earnings and dividends are expected to grow at 12% per year for the forseeable future. If the firm issues new common stock, the shares would sell for $85 per share. Flotation costs will amount to 5% of market price. What is the firm's cost of external equity
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