Question
P14-11 Finding the Target Capital Structure [LO3] Fama's Llamas has a weighted average cost of capital of 11 percent. The company's cost of equity is
P14-11 Finding the Target Capital Structure [LO3]
| Fama's Llamas has a weighted average cost of capital of 11 percent. The company's cost of equity is 17 percent, and its pretax cost of debt is 8 percent. The tax rate is 32 percent. What is the company's target debt-equity ratio? (Do not round your intermediate calculations.) |
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Investment Analysis And Portfolio Management
Authors: Frank K. Reilly, Keith C. Brown
9th Edition
0324656122, 978-0324656121
