Question 4 (2 points) Costly Corporation is considering using equity financing. Currently, the firm's stock is selling for $31.00 per share. The firm's dividend for next year is expected to be $3.00 with an annual growth rate of 4.0% thereafter indefinitely. If the firm issues new stock, the flotation costs would equal 12.0% of the stock's market value. The firm's marginal tax rate is 40%. What is the firm's cost of internal equity? 15.44% 15.00% 14.06% 13.68% 12.89% Question 5 (2 points) Costly Corporation is considering using equity financing. Currently, the firm's stock is selling for $36.00 per share. The firm's dividend for next year is expected to be $4.80 with an annual growth rate of 4.0% thereafter indefinitely. If the firm issues new stock, the flotation costs would equal 10.0% of the stock's market value. The firm's marginal tax rate is 40%. What is the firm's cost of external equity? 18.81% 17.33% 17.87% 19.41% 17.74%