Based on this estimate the cost of common stock financing


You have gathered the following information about your firm:

Current Stock Price (Common) ==> $51

Forecasted Dividend (D1) ==> $2.08

Beta ==> 1.5

YTM on Debt ==> 11.49%

Coupon Rate on Debt ==> 9.59%

Treasury Bond Yield ==> 2.8%

Growth Rate on Dividends ==> 3.4%

Market Risk Premium (km - krf) ==> 4%

Risk Premium for our stock over our Bonds ==> 6.2%

Based on this, estimate the cost of common stock financing based on the Bond Yield plus Risk Premium approach. Round to 2 decimal places in percentage terms.

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Financial Management: Based on this estimate the cost of common stock financing
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