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Calculate the Company's Cost of Equity Given the Following Information

Question 201

Multiple Choice

Calculate the company's cost of equity given the following information: return on assets 7.0%; return on debt 3.25%; 25% debt; 75% equity.

A) 7.50%
B) 8.25%
C) 9.00%
D) 9.75%
E) 10.50%

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