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Tata Inc. is an all equity firm in a perfect capital market. The cost of equity is 12%. The firm is going to have a

Tata Inc. is an all equity firm in a perfect capital market. The cost of equity is 12%. The firm is going to have a leverage recap, which will increase the debt-to-equity ratio to 1. If the cost of debt is 6% after the recap, what is the new cost of equity? A. 12%. B. 18%. C. 21%. D. 15%

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