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## Finance

 Basic Finance Corporate Finance Financial Management Financial Econometrics Portfolio Management Risk Management Public Finance Business Law & Ethics

Johnson Tire Distributors has an unlevered cost of capital of 12 percent, a tax rate of 34 percent, and expected earnings before interest and taxes of \$1,400. The company has \$2,800 in bonds outstanding that have a 7 percent coupon and pay interest annually. The bonds are selling at par value. What is the cost of equity?

Multi-choice:

A)9.51 percent

B)10.86 percent

C)8.15 percent

D)12.22 percent

E)13.58 percent

Basic Finance, Finance

• Category:- Basic Finance
• Reference No.:- M938298

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