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Neptune Corporation has a marginal tax rate of 21%. The firm recently paid a cash dividend of $3.00 to its common stockholders. Earnings and dividends
Neptune Corporation has a marginal tax rate of 21%. The firm recently paid a cash dividend of $3.00 to its common stockholders. Earnings and dividends are expected to grow at 4% per year for the foreseeable future. If the firm issues new common stock, the shares should sell for $57 each. Flotation costs will amount to $4.00 per share. What would be the firm's cost of external equity? SET YOUR CALCULATOR TO 4 DECIMAL PLACES AND ROUND TO 2 DECIMAL PLACES AT THE END. DO NOT ENTER THE % SIGN. IF YOUR ANSWER IS 7.7011%. FOR EXAMPLE, ENTER 7.70
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