Chandeliers corp has no debt but can borrow at 64 percent


Chandeliers Corp. has no debt but can borrow at 6.4 percent. The firm’s WACC is currently 8.2 percent, and the tax rate is 35 percent.

A: If the firm converts to 35 percent debt, what is the company’s WACC? (Round your answer to 2 decimal places. (e.g., 32.16))

B: If the firm converts to 50 percent debt, what is the company’s WACC? (Round your answer to 2 decimal places. (e.g., 32.16))

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Financial Management: Chandeliers corp has no debt but can borrow at 64 percent
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