Question: Question 9 2 pts Builtrite has come up with the following capital structure which management believes is optimal Debt 50% Preferred Stock 10% Common Stock

Question 9 2 pts Builtrite has come up with the following capital structure which management believes is optimal Debt 50% Preferred Stock 10% Common Stock 40% Common Stock Currently, the stock is selling for $72 a share and has paid a $4.09 dividend. Dividends are expected to continue growing at 10%. Issuance would be $2.50 a share and Builtrite has $350.000 in available retained earnings Assume a 40% tax bracket The after-tax cost of new common is: 15.68% 15.97 164

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