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Company ABC wants to have a weighted average cost of capital of 9.5 percent. The firm have after tax cost of debt of 6.5 percent
Company ABC wants to have a weighted average cost of capital of 9.5 percent. The firm have after tax cost of debt of 6.5 percent and cost of equity of 12.75 percent.What debt to equity ratio is needed for the firm to achieve its target weighted average cost of capital?
A) 0.76
B) 0.92
c) 1.08
D) 0.84
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