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Kelly Corporation will issue new common stock to finance an expansion. The existing common stock just paid a $1.50 dividend, and dividends are expected to grow at a constant rate 8% indefinitely. The stock sells for $45, and flotation expenses of 5% of the selling price will be incurred on new shares.

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Question: What is the cost of new common stock be for Kelly Corp?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91167999

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