Southern Corporation has a capital structure of 40% debt and 60% common equity. This capital structure is expected not to change. The firm's tax rate is 34%. The firm can issue the following securities to finance capital investments: Debt: Capital can be raised through bank loans at a pretax cost of 8.5%. Also, bonds can be issued at a pretax cost of 10%. Common Stock: Retained earnings will be available for investment. In addition, new common stock can be issued at the market price of $59. Flotation costs will be $3 per share. The recent common stock dividend was $3.15. Dividends are expected to grow at 7% in the future. What is the cost of capital if the firm uses bonds and issues new common stock? StoreAge Inc. recently paid its annual dividend of $3, and reported an ROE of 15%. The firm pays out 50% of its earnings as dividends. The stock has a beta of 1.28. The current risk-free rate is 2.6% and the market return is 9.6%. Assuming that CAPM holds, what is the intrinsic value of this stock? 0 $76.57 O $79.43 O $85.76 O $75.43 O $75.75