A Firm Has a Weighted Average Cost of Capital of 11.28

question 88

Multiple Choice

A firm has a weighted average cost of capital of 11.28 percent and a cost of equity of 14.7 percent.The debt-equity ratio is .72.There are no taxes.What is the firm's cost of debt?

• A)6.53 percent
• B)6.27 percent
• C)6.44 percent
• D)7.23 percent
• E)7.08 percent

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Definitions:

Brain

The organ located in the skull responsible for the central nervous system's functions, including processing sensory information, regulating bodily functions, and enabling cognition and emotional responses.

Pancreas

An organ in the digestive and endocrine systems that produces hormones such as insulin and digestive enzymes.

Insulin

A hormone produced by the pancreas that regulates blood sugar levels by facilitating the uptake of glucose into tissues.

Bloodstream

The flowing blood within the circulatory system of the body.