Justice,Inc

question 92

Multiple Choice

Justice,Inc.has a capital structure which is based on 30 percent debt,5 percent preferred stock,and 65 percent common stock.The flotation costs are 11 percent for common stock,10 percent for preferred stock,and 7 percent for debt.The corporate tax rate is 37 percent.What is the weighted average flotation cost?

• A)8.97 percent
• B)9.48 percent
• C)9.62 percent
• D)9.75 percent
• E)10.00 percent

---

Definitions:

Procedural Requirements

The rules and guidelines that must be followed for legal processes to be considered valid and lawful.

Notice and Comment

Notice and comment is a regulatory process allowing the public to give input on draft regulations before they are finalized by publishing a notice of proposed rulemaking.

Formal Rulemaking

A process in administrative law where rules are made by government agencies following a formal procedure that includes public notice and the opportunity for public comment.

Rulemaking Procedure

The formal process by which government agencies establish, modify, or repeal regulations and legal norms.