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A firm has zero debt in its capital structure. Its overall cost of capital is 15%. The firm is considering a new capital structure with
A firm has zero debt in its capital structure. Its overall cost of capital is 15%. The firm is considering a new capital structure with 55% debt. The interest rate on the debt would be 6%. Assuming there are no taxes its cost of equity capital with the new capital structure would be O 8% 26% 16% 139 If a firm is unlevered and has a cost of equity capital 9%, what would the cost of equity be if the firms became levered at a debt-equity ratio of 182 The expected cost of debt is 7%. (Assume no taxes.) O 12.6% 14.5% O 16.0% O 15.0%
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