Famas Llamas has a weighted average cost of capital of 10.3 percent. The companys cost of equity is 12 percent, and its pretax cost of
| Famas Llamas has a weighted average cost of capital of 10.3 percent. The companys cost of equity is 12 percent, and its pretax cost of debt is 8.3 percent. The tax rate is 38 percent. What is the companys target debtequity ratio? (Do not round intermediate calculations and round your final answer to 4 decimal places, e.g., 32.1616.) |
| Debtequity ratio |
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Authors: John R. Boatright
3rd Edition
1118615824, 978-1118615829
