question archive Sullivan & Associates expects to pay a common stock dividend of $2
Sullivan & Associates expects to pay a common stock dividend of $2
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Sullivan & Associates expects to pay a common stock dividend of $2.00 per share next year. Dividends are expected to grow at a 5 percent rate for the foreseeable future. Sullivan's common stock is selling for $20 per share, and issuance costs are $3.00 per share.
a. What is Sullivan's cost of internal equity?
b. What is Sullivan's cost of external equity?
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