Attempts

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Keep the Highest $\frac{0}{2}$

$2.$ Practice Problem $11-2$

eBook

Tip Top Hats $($TTH$)$ is expected to grow at a $6$ percent rate for as long as it is in business. Currently the company's common stock is selling for $$22$ per share. The $m$ recent dividend paid by $TTH$ was $$3\mathrm{.}00$ per share. If new common stock is issued, TTH will incur flotation costs equal to $8\mathrm{.}0$ percent.

a$.$ What is the company's cost of retained earnings? Round your answer to two decimal places.

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b$.$ What is its cost of new common equity? Round your answer to two decimal places.

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