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Step 2: Before floatation costs ks = D1/P0 + g = 4.40/50 + .05 = 13.8% Step 3: What is the floatation adjustment?
Step 2: Before floatation costs ks = D1/P0 + g = 4.40/50 + .05 = 13.8% Step 3: What is the floatation adjustment? ) ) floatation adjustment = k E K S = 15.4 These are market weights. Are they optimal? 3. At what point does HD have to issue new equity? B. What is the marginal cost of capital (MCC) beyond BPRE?