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Schoenenberger Corporation will issue new common stock to finance an expansion. The existing common stock just paid a $1.50 dividend; and dividends are expected to
Schoenenberger Corporation will issue new common stock to finance an expansion. The existing common stock just paid a $1.50 dividend; and dividends are expected to grow at a constant rate 8% indefinitely. The stock sells for $45, and flotation expenses of $2.25 will be incurred on new shares. What is the cost of new common stock be for Schoenenberger Corporation? A 11.79% 8. 11.51% c 11.60% D. 1133% E. None of the above
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