Question
A company wants to achieve a weighted average cost of capital of 10.36%. The company has a before-tax cost of debt of 8.46% and a
A company wants to achieve a weighted average cost of capital of 10.36%. The company has a before-tax cost of debt of 8.46% and a cost of equity of 12.26%. If the tax rate is 30%, what debt-to-equity ratio is needed for the company to achieve its target weighted average cost of capital?
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Cost Management Measuring Monitoring And Motivating Performance
Authors: Leslie G. Eldenburg, Susan Wolcott, Liang Hsuan Chen, Gail Cook
2nd Canadian Edition
1118168879, 9781118168875
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