Hiawatha Corp. expects to earn $3.50 per share by the end of the current year, its expected dividend payout ratio is 60%, its expected constant dividend growth rate is 8.0%, and its common stock currently sells for $50 per share. New stock can be sold to the public at the current price, but a flotation cost of 15% would be incurred. What would be the cost of equity from new common stock? 12.20% 12.94% 12.61% O 12.78% O None of the above. Question 10 Assume that you are on the finance staff of 2M Inc. and you have collected the following data: The yield on the company's outstanding bonds is 6.50%, its tax rate is 35%, the next expected dividend at the end of the year is $1.10 a share, the dividend is expected to grow at a constant rate of 8% per year, the price of the stock is currently $25 per share, the flotation cost for selling new shares is 10%, and the target capital structure is 35% debt and 65% common equity. What is the firm's WACC (assuming it must issue new stock to finance its capital budget)? 9.74% 10.24% 11.81% 9.86% 10 pts O None of the above