(Individual or component costs of capital) Compute the costs for the following sources of financing: a. A $1,000 par value bond with a market price of $970 and a coupon interest rate of 11 percent. Flotation costs for a new issue would be approximately 7 percent. The bonds mature in 8 years and the corporate tax rate is 32 percent. b. A preferred stock selling for $111 with an annual dividend payment of $8. The flotation cost will be $9 per share. The company's marginal tax rate is 30 percent. c. Retained earnings totaling 54.8 million. The price of the common stock is $78 per share, and dividend per share was $9.68 last year. The dividend is not expected to change in the future. d. New common stock for which the most recent dividend was $2.85. The company's dividends per share should continue to increase at a growth rate of 11 percent into the indefinite future. The market price of the stock is currently $59; however, flotation costs of $9 per share are expected if the new stock is issued. a. What is the firm's after-tax cost of debt on the bond? % (Round to two decimal places.) (Individual or component costs of capital) Compute the costs for the following sources of financing: a. A $1,000 par value bond with a market price of $970 and a coupon interest rate of 11 percent. Flotation costs for a new issue would be approximately 7 percent. The bonds mature in 8 years and the corporate tax rate is 32 percent. b. A preferred stock selling for $111 with an annual dividend payment of $8. The flotation cost will be $9 per share. The company's marginal tax rate is 30 percent. c. Retained earnings totaling 54.8 million. The price of the common stock is $78 per share, and dividend per share was $9.68 last year. The dividend is not expected to change in the future. d. New common stock for which the most recent dividend was $2.85. The company's dividends per share should continue to increase at a growth rate of 11 percent into the indefinite future. The market price of the stock is currently $59; however, flotation costs of $9 per share are expected if the new stock is issued. a. What is the firm's after-tax cost of debt on the bond? % (Round to two decimal places.)