1. A firm is paying an annual dividend of $6.00 for its preferred stock which is selling for $69.00. There is a selling cost of $3.00. What is the after-tax cost of preferred stock if the firm's tax rate is 35%? (Round your answer to 2 decimal places.)
10.54%
9.09%
11.24%
7.74%
A firm's stock is selling for $77. The next annual dividend is expected to be $3.00. The growth rate is 9%. The flotation cost is $8. What is the cost of retained earnings? (Round your answer to 2 decimal places.)
10.75%
11.55%
12.90%
14.35%
The coupon rate on an issue of debt is 9%. The yield to maturity on this issue is 10%. The corporate tax rate is 32%. What would be the approximate after-tax cost of debt for a new issue of bonds? (Round your answer to 2 decimal places.)
6.80%
8.95%
5.45%
8.25%
Firm X has a tax rate of 25%. The price of its new preferred stock is $68 and its flotation cost is $2.00. The cost of new preferred stock is 11%. What is the firm's dividend? (Round your answer to 2 decimal places.)
$9.41
$7.26
$5.91
$8.71
Expected cash dividends are $4.00, the dividend yield is 8%, flotation costs are 6% of price, and the growth rate is 3%. Compute cost of new common stock. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
12.51%
11.51%
13.61%
11.26%
The coupon rate on a debt issue is 5%. If the yield to maturity on the debt is 9%, what is the after-tax cost of debt in the weighted average cost of capital if the firm's tax rate is 33%? (Round your answer to 2 decimal places.)
7.38%
8.18%
4.68%
6.03%