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Problem 4: Retained Earnings versus New Common Stock Using the data shown in the following table, calculate each firm's: a. Cost of retained earnings (rs)

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Problem 4: Retained Earnings versus New Common Stock Using the data shown in the following table, calculate each firm's: a. Cost of retained earnings (rs) b. Cost of new common stock (rn) Firm Do Flotation cost per share Market Dividend Price Growth per Rate share $80 8% $30 6% $45 7% $22 4% Under pricing share $2.00 $1.00 $1.50 $2.50

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