a) State 3 differences between financing with debt and equity.

b) Is it better to purchase Common Stock or Preferred Stock?Give at least 3 reasons to support your answer.

c) Nick wants to invest in RBL shares. he found out that last year they paid dividends of $2.50 and they anticipate that this dividends would grow at a rate of 10% for years 1 & 2, then to a constant growth rate of 7% from year 3 until infinity.Find out the value of the stock if the expected rate of return is 10%.