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Problem 5. Show all work such as formulas. A company plans to pay an annual perpetual dividend of $2.00 on its newly issued preferred stock

Problem 5. Show all work such as formulas. image text in transcribed
A company plans to pay an annual perpetual dividend of $2.00 on its newly issued preferred stock that is current valued at $45. If it faces a 5% flotation cost on this issue, what is its after-tax cost of preferred stock

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