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10. ABC Company's debt/equity=0, its cost of equity is 10.8% and it can borrow at 8%. If there are no taxes, what will be the

10. ABC Company's debt/equity=0, its cost of equity is 10.8% and it can borrow at 8%. If there are no taxes, what will be the cost of equity if ABC changes its debt/equity to 0.5? A) 10.8% B) 11.2% C) 12.2% D) 14.4% E) 18.8%

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