Multiple Choice
A levered firm has a pretax cost of debt of 6.8 percent and an unlevered cost of capital of 13.4 percent.The tax rate is 34 percent,and the cost of equity is 16.06 percent.What is the debt-equity ratio?
A) 0.57
B) 0.45
C) 0.51
D) 0.47
E) 0.61
Correct Answer:
Verified
Correct Answer:
Verified
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