Johnson and Smith (J&S) Inc. is planning to issue common stock at $16 per share They just paid a $1.50 per share dividend on their existing common stock, and they expect this dividend to grow at a rate of 4 percent per year, forever. The investment bank that J&S employs will charge a flotation cost equal to 4 percent of the current market price. The cost of J&S's new common stock will be closest to:

	a.	13.80 percent
	b.	16.92 percent
	c.	15.36 percent
	d.	10.15 percent
	e.	14.16 percent