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If a frm plans to issue new stock, flotation costs (ievestment banker' fees) should not be ignored. There are two asprosches to use to account
If a frm plans to issue new stock, flotation costs (ievestment banker' fees) should not be ignored. There are two asprosches to use to account for fotation costs. The first approwch is to add the wum of fotation costs for the debt, preferred, and common steck and add them to the initsil livesstment cost. Because the investment cost is increased, the project's expected rate of retum is reduced so it may hot meet the firm's hurdie rate for sccestance of the project. The secend approach involves adjusting the cost of common equity as follorsi earoings? bo not round internes ate caicilations. Round your answer to bro decimal places. What is the cest of new eominon equity considering the evimate made frem the thee etimation methodologies? Do not round intermediate catcilacians. Aound your arswer to two sedimal pibute. If a frm plans to issue new stock, flotation costs (ievestment banker' fees) should not be ignored. There are two asprosches to use to account for fotation costs. The first approwch is to add the wum of fotation costs for the debt, preferred, and common steck and add them to the initsil livesstment cost. Because the investment cost is increased, the project's expected rate of retum is reduced so it may hot meet the firm's hurdie rate for sccestance of the project. The secend approach involves adjusting the cost of common equity as follorsi earoings? bo not round internes ate caicilations. Round your answer to bro decimal places. What is the cest of new eominon equity considering the evimate made frem the thee etimation methodologies? Do not round intermediate catcilacians. Aound your arswer to two sedimal pibute
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