Question
Portneuf Industries has a debt-equity ratio of 1.5. Its WACC is 8.4%, and its cost of debt is 5.9%. The corporate tax rate is 35%.
Portneuf Industries has a debt-equity ratio of 1.5. Its WACC is 8.4%, and its cost of debt is 5.9%. The corporate tax rate is 35%. (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places.) a. What is the companys cost of equity capital? Cost of equity capital % b. What is the companys unlevered cost of equity capital? Unlevered cost of equity capital % c-1. What would the cost of equity be if the debt-equity ratio were 2? Cost of equity % c-2. What would the cost of equity be if the debt-equity ratio were 1.0? Cost of equity % c-3. What would the cost of equity be if the debt-equity ratio were zero? Cost of equity %
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