Using the constant-growth valuation model determine the, Financial Management

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Using the constant-growth valuation model determine the

Cost of common stock equity

Assume that today is January 1, 2013. Ross Textiles wishes to measure its cost of common stock equity. The firm's stock is currently selling for $55.69. The firm expects to pay a $1.67 dividend at the end of the year (2013). The growth rate of the dividends is 7.46%. After underpricing and flotation? costs, the firm expects to net $49.56 per share on a new issue.

a. Using the constant-growth valuation model, determine the cost of retained earnings, r Subscript s.

b. Using the constant-growth valuation model, determine the cost of new common stock, r Subscript n

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Financial Management: Using the constant-growth valuation model determine the

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Financial Management: Using the constant-growth valuation model determine the

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