QUESTION 9 Atlantic Company wants to have a weighted average cost of capital of 10.4%. The firm has an after-tax cost of debt of 5,5% and a cost of equity of 14.2%. What debt-equity ratio is needed for the firm to achieve its targeted weighted average cost of capital? (Hint: Ws+ Wd = 1) 1.60 1.25 0.96 0.78 0.52 QUESTION 10 Orbi Corporation has 600,000 shares of common stock outstanding at a market price of $45 a share. Last month, the company paid an annual dividend in the amount of $1.80 per share. The dividend growth rate is 6%. Orbi also has 25,000 bonds outstanding with a face value of $1,000 per bond. The bonds carry a 6% coupon, pay interest annually, and mature in 10 years. The bonds are sold at par. The company's tax rate is 25%. What is the company's weighted average cost of capital? 7.48% 7.65% 7.83% 7.12% 6.87%