Question
1. The required return on equity for an all-equity firm is 11.42%. They are considering a change in capital structure with 59% of debt. The
1. The required return on equity for an all-equity firm is 11.42%. They are considering a change in capital structure with 59% of debt. The pre-tax cost of debt is 6.74%. The tax rate is 38%. Find the new cost of capital after the capital structure change.
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The International Handbook Of Public Financial Management
Authors: Richard Allen, Richard Hemming, B. Potter
1st Edition
1137574895, 978-1137574893
