If kaycee decides to issue new common stock flotation costs, Financial Management

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If kaycee decides to issue new common stock flotation costs

Johnson production company paid a dividend yesterday of $3.50 per share. The dividend is expected to grow at a constant rate of 10% per year. The price of KayCee's common stock is $40 per share. If KayCee decides to issue new common stock, flotation costs will equal $4.00 per share. KayCee's marginal tax rate is 35%. Based on the above information, the cost of new common stock is

A) 17.55%

B) 19.63%

C) 26.41%

D) 20.09%

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Financial Management: If kaycee decides to issue new common stock flotation costs

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Financial Management: If kaycee decides to issue new common stock flotation costs

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