What is the cost of internal common equity

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Saccar Inc. expects to pay a dividend of $4.12 per share in one year. The current price of Saccar common stock is $30.21 per share. Flotation costs are $3.59 per share when the corporation issues new stock. What is the cost of internal common equity (retained earnings) if the long-term growth in dividends is projected to be 5 percent indefinitely? Submit your answer as a percentage and round to two decimal places (Ex. 0.00%)

Reference no: EM132396779

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