Riverhawk Store (RS) dividends have been growing at 3 percentannually and are expected to continue this growth rateindefinitely. The company recently paid a dividend of $1.25 pershare. Next year, it expects to add $3 million to retainedearnings. RP’s common stock is selling for $17.00 per share. Thecompany is expanding and plans to sell new common stock withflotation costs of 4 percent. the company\'s cost of retainedearnings is 10.57%, and its average cost of equity fundsis 10.67%,

What is the company’s cost of new equity?

Answer rating: 100% (QA)

Answer To calculate the cost of new equity we need to consider th... View the full answer