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Finance

During the next 12 months, Tire Auto Supply expects to pay dividends (D1) of $2.70 per share, and the current price of its common stock is $50 per share. The expected growth rate is 7 percent.

1. Compute the cost of retained earnings (Ke). Answer as a percent rounded to 2 decimal places.

2. If a $3 flotation cost is involved, compute the cost of new common stock (Kn). Answer as a percent rounded to 2 decimal places

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92727191

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