Question
Bermuda Cruises issues only common stock and coupon bonds. The firm has a debtequity ratio of 1.19. The cost of equity is 12.4 percent and
Bermuda Cruises issues only common stock and coupon bonds. The firm has a debtequity ratio of 1.19. The cost of equity is 12.4 percent and the pretax cost of debt is 7 percent. What is the capital structure weight of the firm's equity if the firm's tax rate is 39 percent?
.4566
.5434
.5019
.5284
.4288
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Financial Management Theory And Practice
Authors: Eugene Brigham, Michael Ehrhardt, Jerome Gessaroli, Richard Nason
3rd Canadian Edition
017658305X, 978-0176583057
