Question
a firm has a debt equity ratio of .64, a cost equity of 13.04, and a cost of debt of 8 percent. The corporate tax
a firm has a debt equity ratio of .64, a cost equity of 13.04, and a cost of debt of 8 percent. The corporate tax rate is 35 percent. What would be the cost of equity if the firm were all-equity financed?
a. 12.07%
b. 11.56%
c. 12.42%
d. 13.33%
e. 11.11%
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Contemporary Business Mathematics with Canadian Applications
Authors: S. A. Hummelbrunner, Kelly Halliday, K. Suzanne Coombs
10th edition
133052311, 978-0133052312
