Question
Rosita's has a cost of equity of 14% and a pre-tax cost of debt of 8%. The debt-equity ratio is 0.5 and the tax rate
Rosita's has a cost of equity of 14% and a pre-tax cost of debt of 8%. The debt-equity ratio is 0.5 and the tax rate is 34%.
What is Rosita's unlevered cost of capital?(Round answer to 4 decimal places, round intermediate calculations to 5 decimal places).
Unlevered Cost of Capital
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Financial Markets and Institutions
Authors: Jeff Madura
12th edition
9781337515535, 1337099740, 1337515531, 978-1337099745
