XYZ is trying to estimated its cost of capital and needs to know the cost of preferred stock. XYZ can issue new preferred stock with a $100 par value and a 5% dividend. New preferred stock would have...

XYZ is trying to estimated its cost of capital and needs to know the cost of preferred stock. XYZ can issue new preferred stock with a $100 par value and a 5% dividend. New preferred stock would have a price of $99. What is the cost of preferred stock for XYZ?