Problem 10.13 (Cost of Common Equity with Flotation) Question 8 of 20 Check My Work (3 remaining) eBook Problem Walk-Through Banyan Co.'s common stock currently sells for $40.75 per share. The growth rate is a constant 8%, and the company has an expected dividend yield of 3%. The expected long-run dividend payout ratio is 20%, and the expected return on equity (ROE) is 10.0%. New stock can be sold to the public at the current price, but a flotation cost of 15% would be incurred. What would be the cost of new equity? Do not round intermediate calculations. Round your answer to two decimal places. % Problem 10.14 (Cost of Preferred Stock including Flotation) Question 9 of 20 Check My Work (3 remaining) eBook Travis Industries plans to issue perpetual preferred stock with an $11.00 dividend. The stock is currently selling for $111.00, but flotation costs will be 6% of the market price, so the net price will be $104.34 per share. What is the cost of the preferred stock, including flotation? Round your answer to two decimal places. % Problem 10.15 (WACC and Cost of Common Equity) Question 10 of 20 Check My Work (3 remaining) eBook Kahn Inc. has a target capital structure of 70% common equity and 30% debt to fund its $11 billion in operating assets. Furthermore, Kahn Inc. has a WACC of 12%, a before-tax cost of debt of 11%, and a tax rate of 25%. The company's retained earnings are adequate to provide the common equity portion of its capital budget. Its expected dividend next year (D1) is $3, and the current stock price is $35. a. What is the company's expected growth rate? Do not round intermediate calculations. Round your answer to two decimal places. % b. If the firm's net income is expected to be $2.0 billion, what portion of its net income is the firm expected to pay out as dividends? Do not round intermediate calculations. Round your answer to two decimal places. (Hint: Refer to Equation below.) Growth rate (1 - Payout ratio)ROE %