Spartan Ltd Has an Unlevered Cost of Capital of 11%,a

Multiple Choice

Spartan Ltd has an unlevered cost of capital of 11%,a cost of debt of 8%, and a tax rate of 35%.What is the target debt-equity ratio if the targeted cost
Of equity is 12%?

A) .44
B) .49
C) .51
D) .56
E) .62