Glover Tools Has a Pre-Tax Cost of Debt of 9

question 117

Multiple Choice

Glover Tools has a pre-tax cost of debt of 9% and an unlevered cost of capital of 13.5%. The firm's tax rate is 34% and the cost of equity is 15%. What is the firm's debt-equity ratio?

• A) .42
• B) .48
• C) .51
• D) .58
• E) .64

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Definitions:

Impression Management

Is the systematic attempt to influence how others perceive us.

Nonverbal Aspects

Elements of communication that do not involve words, such as gestures, facial expressions, and body language.

Two-way

A form of communication that involves not just sending messages but also receiving and effectively responding to them, fostering a dialogue.

One-way

Referring to communication or interaction that goes in a single direction without reciprocal feedback or exchange.