Question
Macrosoft has a weighted average cost of capital of 8 percent. The companys cost of equity is 11 percent, and its pretax cost of debt
Macrosoft has a weighted average cost of capital of 8 percent. The companys cost of equity is 11 percent, and its pretax cost of debt is 5 percent. The tax rate is 25 percent. (a) What is the companys target debt-equity ratio? (b) What is the companys equity-debt ratio (E/V)?
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Foundations Of Financial Management
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen
17th Edition
126001391X, 978-1260013917
