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QUESTION 4 A company wants to have a weighted average cost of capital of 7.8%. The firm has an after-tax cost of debt of 5.4%

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QUESTION 4 A company wants to have a weighted average cost of capital of 7.8%. The firm has an after-tax cost of debt of 5.4% and a cost of equity of 12%. What debt-equity ratio is needed for the firm to achieve its targeted weighted average cost of capital? (Hint: Wd + Ws = 1) O 1.40 1.87 1.75 1.52 1.64

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