Pobiem 14-30 Flotation Costs and NPV (LO4,7) Rotlaw Cofpotalion (RC) manufactures 1 inesserims photographic eequlprnent. it is currently ot its target debt-equity ratio of O. gr. Its considisting building a riew $44 milton mamufacturing facility. Fhis new plant is expected to generate after-tax cash flows of $63. 3 is million in perpetity. The compony raises all equity from outside financing There are three financing options: 1. A new issue of comman srock. The fiotation costs of the new comrnon stock would be 10% of the amount ialsed The required return Qit the compary's new equity is 16 s. 2. A riew issue of 20.yetar bonds The flotation costs of the new bonds would be 4. of the proceeds. If the corripany issues these new bandis at an annual coupon rate of 8.04, thoy wil seil at par J. fincreysed use of accounts payable finaricing. Becouse this financing is part of the compony's ongoing daily business, it has no fiotetion costs, and the company assigns it a cost that is the same os the overall firm WACC. Managertent has a target ratio of accounts payoble to long-1erm debt of 0200 . (Assume there is no difference botween the pre-tex and after-tax occounts payable casis calculatont. Raund the WACC percentege to 2 efecimat ploces. Round the final enswer to 2 decimal places. Omit 5 sign in your resporise) NEV