What is its component cost of preferred stock

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Question - Ebeling Inc. has a perpetual preferred stock dividend of 1.55 per quarter and its current stock price is 16. What is its component cost of preferred stock?

Emphyrio Inc. wishes to issue new stock to finance an aggressive expansion. Lord investment bank charges a flotation cost of 0.17 as a fraction of each stock sold. Emphyrio's current stock price is 20, and it expects to pay a dividend of 0.73 at the end of the year. What is Emphyrio's component cost of a new equity issue?

Amiante corporation bonds are currently trading for $980 and make annual payments of $40. The bonds will mature in 20 years at which time they will have a face value of $1,000. What is the component cost of Amiante's debt?

Reference no: EM132994210

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