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Question: Question 2 KSS common stock has a beta of 1.5. The market long-term expected return is 12% and th...

Question 2

KSS common stock has a beta of 1.5. The market long-term expected return is 12% and the risk free rate is 2%. What is the cost of retained earnings?

	14%
	11%

	15%
	17%

Question 3

CIS common stock currently pays a dividend of $2 per share and trades for $40 per share. New shares can be issued with a $2 per share floatation cost CIS is expected to grow at 4%. What is the cost of a new stock issue?

	9.47%
	12.32%

	12.76%
	4.70%