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The Corner Bakery has a debt-equity ratio of 0.62. The firm's required return on assets is 14.2 percent and its cost of (levered) equity is
The Corner Bakery has a debt-equity ratio of 0.62. The firm's required return on assets is 14.2 percent and its cost of (levered) equity is 16.1 percent. What is the pre-tax cost of debt based on M & M Proposition II with no taxes?
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