Question
Dickerson Corporation's common stock is currently selling for $38. Last year's dividend was $4.00 per share. Investors expect dividends to grow at an annual rate
Dickerson Corporation's common stock is currently selling for $38. Last year's dividend was $4.00 per share. Investors expect dividends to grow at an annual rate of 7 percent indefinitely. Flotation costs of 4% will be incurred when new stock is sold.
What is the cost of internal common equity?
What is the cost of new common equity?
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Contemporary Financial Management
Authors: James R Mcguigan, R Charles Moyer, William J Kretlow
10th Edition
978-0324289114, 0324289111
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