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Cost of equity and flotation costs

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The Cost of Equity and Flotation Costs

Messman Manufacturing will issue common stock to the public for $25. The expected dividend and the growth in dividends are $2.25 per share and 4%, respectively. If the flotation cost is 13% of the issue's gross proceeds, what is the cost of external equity, re? Round your answer to two decimal places.

Reference no: EM132398398

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