Multiple Choice
Pain-Free Inc.is a business dealing in pain reduction medication.It has a required return on its assets of 18%.It can borrow in the debt market at 10%.If there are no taxes and M&M's proposition II holds,what is the cost of equity if there is 50% equity financing and 50% debt financing?
A) 18%
B) 26%
C) 28%
D) None of these
Correct Answer:
Verified
Correct Answer:
Verified
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