ebook Problem Walk Through Cost of Equity Radon Homes' current EPS is $6.90. It was $4.17 5 years ago. The company pays out 50% of its earnings as dividends, and the stock sells for $10. a. Calculate the historical growth rate in earnings. (Hint: This is a 5-year growth period.) Do not round intermediate calculations. Round your answer to two decimal places. b. Calculate the next expected dividend per share, D. (Hint: Do - 0.50($6.90) - $3.45.) Assume that the past growth rate will continue. Do not round intermediate calculations. Round your answer to the nearest cent. c. What is Radon's cost of equity, 1s? Do not round intermediate calculations. Round your answer to two decimal places. eBook The Cost of Equity and Flotation Costs Messman Manufacturing will issue common stock to the public for $35. The expected dividend and the growth in dividends are $3.00 per share and 6%, respectively. If the flotation cost is 13% of the issue's gross proceeds, what is the cost of external equity, re? Round your answer to two decimal places