Question: Consider this data: Bond coupon rate ( pre-tax): 8.60% Last year's Common Dividend: $1.60 Dividend - Preferred: 3.50 Market Price - Common $36.00 Market Price

Consider this data: Bond coupon rate ( pre-tax): 8.60% Last year's

Consider this data: Bond coupon rate ( pre-tax): 8.60% Last year's Common Dividend: $1.60 Dividend - Preferred: 3.50 Market Price - Common $36.00 Market Price - Preferred $53.00 Most recent overall Market Return: 7% Flotation Cost per share of preferred: $8.00 Compound growth rate of common dividends: 5% Most recently publishcharisk free rate: 2.5% Corporate Tax Rate: 35% Beta: 1.7 Calculate the Weighted after-tax Cost of Preferred: Use 4 decimals in your answer. 0.0778 O 0312 0.0029 0.05057

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