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If axelrod inc issues new common stock its flotation costs

Axelrod, Inc. is expected to pay a cash dividend of $2.50 this coming year. The stock is currently selling for $56.00 per share and the firm's expected constant growth rate is 5.00%. If Axelrod, Inc. issues new common stock, its flotation costs will be $4.00 per share. What will the firm expect its cost of new common stock to be?

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Finance Basics: If axelrod inc issues new common stock its flotation costs

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