Question
SSU is currently a levered firm with a debt-equity ratio of 0.35 and a pretax cost of debt of 6.2%. The firm has a cost
SSU is currently a levered firm with a debt-equity ratio of 0.35 and a pretax cost of debt of 6.2%. The firm has a cost of equity of 12.60%. The firm is considering switching to an all equity firm. What will the firm's cost of equity be if it makes the switch?
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Corporate Finance Core Principles and Applications
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford Jordan
5th edition
1259289907, 978-1259289903
