(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 $965 and a coupon interest rate of 12 percent. Flotation costs for a new issue would be approximately 6 percent. The bonds mature in 14 years and the corporate tax rate is 23 percent. b. A preferred stock selling for $107 with an annual dividend payment of $9. The flotation cost will be $6 per share. The company's marginal tax rate is 23 percent c. Retained earnings totaling $4.8 million. The price of the common stock is $82 per share, and dividend per share was $9.04 last year. The dividend is not expected to change in the future. d. New common stock for which the most recent dividend was $3.02. The company's dividends per share should continue to increase at a growth rate of 9 percent into the indefinite future. The market price of the stock is currently \$61; however, flotation costs of $6 per share are expected if the new stock is issued. a. What is the firm's after-tax cost of debt on the bond? 16. (Round to two decimal places.)