Question: Just need the interpretation (wording) as requested on instructions please 1. XYZ company is undergoing a major expansion. The expansion will be financed by issuing
1. XYZ company is undergoing a major expansion. The expansion will be financed by issuing new 15-year, $1,000 par, 9% annual coupon bonds. The market price of the bonds is $1,070 each. Flotation expense on the new bonds will be S50 per bond. The marginal tax rate is 35%. What is the post-tax cost ofdebt for the newly-issued bonds? 2. ABC Corporation will issue new common stock to finance an expansion. The existing common stock just paid a $1.50 dividend, and dividends are expected to grow at a constant rate 8% indefinitely. The stock sells for S45, and flotation expenses of 5% of the selling price will be incurred on new shares. What is the cost of new common stock? 3. XYZ Inc will issue new common stock to finance an expansion. The existing common stock just paid a $1.50 dividend, and dividends are expected to grow at a constant rate 8% indefinitely. The stock sells for $45, and flotation expenses of 5% of the selling price will be incurred on new shares. What is the cost of internal equity
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