What would be the cost of new common stock equity for Tangshan Mining if the firm...
A)16.88%
B) 9.46%
C) 17.96%
D) none of the above
Homework Answers
Cost of common stock=(D1/Current price-flotation costs)+Growth rate
=(4.25*1.085)/(55-6.25)+0.085
=(4.61125/48.75)+0.085
which is equal to
=17.96%(Approx).
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