What is the cost of internal equity

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Problem 1: YT Inc. will issue new common stock to finance an expansion. The existing common stock just paid a $1.25 dividend. Dividends are expected to grow at a constant rate of 8% indefinitely. The stock sells for $54 and flotation expenses of 10% of the selling price will be incurred on new shares. What is the cost of internal equity?

Reference no: EM132761430

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