culate Cost of Preferred Stock, given: Capital Structure consists of 45% Debt, 45% Preferred Stock, and 10% Equity; DEBT is 25%; Preferred Stock: Sales Price (par value) is $200 and Dividend is $50; Common Stock: Sales Price is $90 and Dividend is $20; Expected Growth Rate is 12%; and the Effective Tax Rate is 26%. 0.55 or 0.25

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter12: The Cost Of Capital
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Calculate Cost of Preferred Stock, given: Capital Structure consists of 45% Debt, 45% Preferred Stock, and 10% Equity; DEBT is 25%; Preferred Stock: Sales Price (par value) is $200 and Dividend is $50; Common Stock: Sales Price is $90 and Dividend is $20; Expected Growth Rate is 12%; and the Effective Tax Rate is 26%.

0.55 or 0.25

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