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Accounting

Problem:

Black and White has a cost of equity of 11 percent and a pre-tax cost of debt of 8.5 percent. The firm's target weighted average cost of capital is 9 percent and its tax rate is 35 percent.

Required:

Question: What is the firm's target debt-equity ratio?

48.29
51.13
55.72
57.56
62.03

Note: Solve the problem and show all work.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91173695

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