Hi there,

I tried to answer these questions based on the same question posted in Chegg. Only a is correct others are wrong. Please help.

Portneuf Industries has a debtequity ratio of 1.5. Its WACC is 8.4%, and its cost of debt is 5.9%. The corporate tax rate is 35%. (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places.) a. What is the companys cost of equity capital? Cost of equity capital 15.25 % (correct) b. What is the companys unlevered cost of equity capital? Unlevered cost of equity capital 0.46 % c-1. What would the cost of equity be if the debtequity ratio were 2? Cost of equity 17.53 % c-2. What would the cost of equity be if the debtequity ratio were 1.0? Cost of equity 12.97 % c-3. What would the cost of equity be if the debtequity ratio were zero? Cost of equity 8.40 %