Question: 8. Diggin Tools plans to issue new preferred stock, which has a market value of $85 per share. Holders of the stock will receive an

8. Diggin Tools plans to issue new preferred stock, which has a market value of $85 per share. Holders of the stock will receive an annual dividend equal to $9.35. The flotation costs associated with the new issue were 6 percent and Diggin's marginal tax rate is 30 percent. What Diggin's component cost of preferred stock, rps? 9. ACME has a beta of 1.07. The return on the market is 10%. The current t-bill rate is 3%. The expected dividend in the next period is $1.00. The expected growth rate is 2%. What is the intrinsic value of ACME stock

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