Keystone Corporation Will Issue New Common Stock to Finance an Expansion.The

question 84

Multiple Choice

Keystone Corporation will issue new common stock to finance an expansion.The existing common stock just paid a $1.50 dividend,and dividends are expected to grow at a constant rate 8% indefinitely.The stock sells for $45,and flotation expenses of 5% of the selling price will be incurred on new shares.What is the cost of new common stock be for Keystone Corp.?

• A) 11.33%
• B) 11.51%
• C) 11.60%
• D) 11.79%
• E) 12.53%

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Definitions:

Amniocentesis

The use of a needle to withdraw amniotic fluid from the amniotic sac.

Cystic Fibrosis

A genetic disorder that causes severe damage to the lungs, digestive system, and other organs in the body.

Genetic Disorders

Diseases or conditions that are caused by abnormalities in an individual's DNA, which can be inherited from parents or occur due to mutations.

Amniocentesis

A medical procedure used in prenatal diagnosis where a small amount of amniotic fluid is sampled to test for chromosomal abnormalities and fetal infections.