David ortiz motors has a target capital structure of 27, Ask an Expert

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David Ortiz Motors has a target capital structure of 27% debt and 73% equity. The yield to maturity on the company's outstanding bonds is 7.40%, and the company's tax rate is 25%. Ortiz's CFO has calculated the company's WACC as 9.15%. What is the company's cost of equity capital?

Answer is either:

a). 10.59

b). 13.10

c). 8.49

d). 10.48

e). 9.75

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92258822

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