Calculate the cost of internal common equity

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Reference no: EM131609665

(Cost of equity?) The common stock for the Bestsold Corporation sells for $59 If a new issue is? sold, the flotation costs are estimated to be 8 percent. The company pays 50 percent of its earnings in? dividends, and a $2.50 dividend was recently paid. Earnings per share 3 years ago were $3.00 Earnings are expected to continue to grow at the same annual rate in the future as during the past 3 years. The? firm's marginal tax rate is 32 percent. Calculate the cost of

?(a?) internal common equity and

?(b?) external common equity.

Reference no: EM131609665

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