Question
FINA Corps current WACC is 8%. The current debt-to-equity ratio is .25. Tax rate is 20%. The cost of debt is 3%. FINA is planning
FINA Corps current WACC is 8%. The current debt-to-equity ratio is .25. Tax rate is 20%. The cost of debt is 3%. FINA is planning to change its debt-to-equity ratio to 0.5. What is the new WACC with the new debt-to-equity ratio? (Please answer in decimal format and keep 4 decimal places. No credit will be awarded if your answer is in percentage.) i know the answer is 0.0778 but how to do it.
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Financial Management Concepts and Applications
Authors: Stephen Foerster
1st edition
013293664X, 978-0132936644
