subject
Business, 16.04.2020 17:48 cxttiemsp021

McCall Corporation has a capital structure consisting of 55 percent common equity, 30 percent debt, and 15 percent preferred stock. Any debt issues would have a pre-tax cost of 9.5%. Preferred stock can be issued for a cost of 11.5%. Common equity can be issued, but flotation costs of $4.25 per share of common stock would be paid. McCall common stock is currently selling in the market at $65 per share. McCall recently paid a dividend of $4 per share and company earnings and dividends are expected to grow at an annual rate of 8% indefinitely. McCall has a tax rate of 21% and the firm wants to keep its current capital structure. If the firm needs to raise additional equity, what will be the firm's cost of capital

ansver
Answers: 2

Another question on Business

question
Business, 22.06.2019 19:00
In 1975, mcdonald’s introduced its egg mcmuffin breakfast sandwich, which remains popular and profitable today. this longevity illustrates the idea of:
Answers: 1
question
Business, 22.06.2019 23:30
Atelephone call center uses three customer service representatives (csrs) during the 8: 30 a.m. to 9: 00 a.m. time period. the standard service rate is 3.0 minutes per telephone call per csr. assuming a target labor utilization rate of 80 percent, how many calls can these three csrs handle during this half-hour period?
Answers: 1
question
Business, 23.06.2019 10:00
How does a business determine the markup on a product or service? by matching the closest competitor by checking online prices by calculating the profit that will keep the business going by considering how much the product is worth to the consumer
Answers: 3
question
Business, 23.06.2019 10:00
Which statement was true in the past but is not generally true today? a. the training and education costs for some jobs will prohibit some people from entering that career be b. young people tend to go into the same job that their parents and grandparents did see c. people need a basic level of education before they meet requirements to professional schools d. people will probably have more than one job in their active working lives
Answers: 1
You know the right answer?
McCall Corporation has a capital structure consisting of 55 percent common equity, 30 percent debt,...
Questions
question
English, 22.08.2019 20:20
question
Mathematics, 22.08.2019 20:20
question
Mathematics, 22.08.2019 20:20