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Why is the cost of equity from new issues of common stock higher than the cost of equity from retained earnings? Because of the flotation
Why is the cost of equity from new issues of common stock higher than the cost of equity from retained earnings? Because of the flotation costs with new issues of common stock Because the Securities \& Exchange Commission levies penalties on firms that must issue new shares of common stock. Because of the high opportunity costs associated with new issues of common stock Because of the high opportunity costs associated with retained earnings Question 8 7 pts MTT Corp. just paid its annual dividend of \$2.40. You expect these dividends to grow at a constant rate of 10% per year for the next 7 to 10 years or so and then to grow indefinitely at an annual rate of 7 percent thereafter. MTT Corp. common stock is currently selling for $53.60 per share. What is the cost of equity for MTT? Cannot be determined 14.4% 14.9% 11.9 125% Question 9 7.5pts Consider a project that requires an initial investment of $5.0 million at time zero. The expected net cash inflows over the five-year life of the project are as follows: $1.2 million at the end of year 1;$1.4 million at the end of year 2;$1.6 million at the end of year 3;$1.8 million at the end of year 4; and $2.4 million at the end of year 5 . If the cost of capital for the project is 14 percent, what is the net present value (NPV) for the project? 5522,070 S458.426 $206.637 5cos,135
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