Multiple Choice
Travel Express has a debt-to-equity ratio of .65.The pretax cost of debt is 8 percent while the unlevered cost of capital is 14 percent.What is the cost of equity if the tax rate is 34 percent?
A) 7.52%
B) 10.78%
C) 16.57%
D) 17.83%
E) 18.30%
Correct Answer:
Verified
Correct Answer:
Verified
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