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Urgent Oval Inc. just paid a dividend equal to $1.70 per share on its common stock, and it expects this dividend to grow by 5
Urgent
Oval Inc. just paid a dividend equal to $1.70 per share on its common stock, and it expects this dividend to grow by 5 percent per year indefinitely. The firm plans to issue common stock, which has a $16 per share market price, to raise funds to support operations. Oval's investment bankers estimate that the flotation costs for new issues of common stock will be equal to 8 percent of the issue (market) price. What is Oval's cost of new common equity, 1,? 14.60% 11.60% O 17.13% 18.76%Step by Step Solution
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