Question
Hilltop Paving has a levered equity cost of capital of 14.92 percent. The debt-to-value ratio is .4, the tax rate is 23 percent, and the
Hilltop Paving has a levered equity cost of capital of 14.92 percent. The debt-to-value ratio is .4, the tax rate is 23 percent, and the pretax cost of debt is 7.2 percent. What is the estimated unlevered cost of equity?
A.13.06%
B.12.30%
C.11.23%
D.10.97%
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Foundations of Financial Management
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen, Doug Short, Michael Perretta
10th Canadian edition
1259261018, 1259261015, 978-1259024979
