Question
A limited company has a WACC (after tax) of 12%. It can borrow at 8%. Assuming that the company has a target capital structure of
A limited company has a WACC (after tax) of 12%. It can borrow at 8%. Assuming that the company has a target capital structure of 80% equity and 20% debt and a tax rate of 30%, what is its cost of equity?
Question 4 options:
8.0%
13.0%
13.6%
8.7%
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Investing In Financial Research A Decision Making System For Better Results
Authors: Cheryl Strauss Einhorn, Tony Blair
1st Edition
1501732757, 9781501732751
