Question: Overland paid a dividend of $3 last year and its stock is selling at $75 per share. A constant growth rate of 5% is expected.

Overland paid a dividend of $3 last year and its stock is selling at $75 per share. A constant growth rate of 5% is expected. Overland's flotation costs for a new issue are 10% of the stock price. Calculate the cost of new equity. a. 8.8% b.8.3% c. 9.7% d.8.6% e.9.2%

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