Home Decor has a pretax cost of debt is 6.8 percent and a tax rate of 22 percent. What is the cost of equity if the debt-equity ratio is .65?

a-16.89%

b-17.07%

c-14.70%

d-15.69%

e-16.44%

The Greenbriar is an all-equity firm with a total market value of $596,000 and 23,200 shares of stock outstanding. Management is considering issuing $213,000 of debt at an interest rate of 9 percent and using the proceeds on a stock repurchase. Ignore taxes. How many shares will the firm repurchase if it issues the debt securities?

a-53,640 shares

b-9,213 shares

c-10,050 shares

d-8,291 shares

e- 746 shares