The debt-equity ratio is 65 and the tax rate is 40 percent, Finance Basics

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The debt-equity ratio is 65 and the tax rate is 40 percent

Cromwell's Interiors is considering a project that is equally as risky as the firm's current operations. The firm has a cost of equity of 13.7 percent and a pretax cost of debt of 8.4 percent. The debt-equity ratio is .65 and the tax rate is 40 percent. What is the cost of capital for this project?

9.97 percent
10.29 percent
11.62 percent
11.38 percent
12.30 percent

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Finance Basics: The debt-equity ratio is 65 and the tax rate is 40 percent

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Finance Basics: The debt-equity ratio is 65 and the tax rate is 40 percent

Reference No:- TGS0610028

Have a Question? (oR Write a Review)

Recent Questions Asked Finance Basics

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Request for Solution File

Ask an Expert for Answer!!

Finance Basics: The debt-equity ratio is 65 and the tax rate is 40 percent

Reference No:- TGS0610028

Recent Questions Asked Finance Basics

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