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Jimbot Inc. has a WACC of 9.5%, cost of debt of 8%, and a cost of equity of 12%. What must the debt-to-equity ratio be

Jimbot Inc. has a WACC of 9.5%, cost of debt of 8%, and a cost of equity of 12%. What must the debt-to-equity ratio be if the company pays no tax?

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SOLUTION To determine the debttoequity ratio we can use the WACC formula which is WACC Cost ... blur-text-image

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