Question
MUST SHOW WORK FOR CREDIT Calculate the firm's current required rate of return on equity using the following information K m = 11.00% current debt
MUST SHOW WORK FOR CREDIT
Calculate the firm's current required rate of return on equity using the following information
| Km = | 11.00% | current debt | $250,000 | |
| Krf = | 5.00% | current equity | $750,000 | |
| Tax rate = | 25.00% | new debt level | $450,000 | |
| current B | 1.0550 | unlevered B | 0.8440 |
Select one:
a. 0.1133
b. 0.1128
c. 0.1161
d. 0.1661
e. 0.1006
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Personal Finance
Authors: Jack Kapoor, Les Dlabay, Robert J. Hughes, Arshad Ahmad, Jordan Fortino
6th Canadian edition
1259453146, 978-1259453144
