JL Lumber Has a Debt-Equity Ratio of 0

question 29

Multiple Choice

JL Lumber has a debt-equity ratio of 0.47.The firm's required return on assets is 11.8 percent and its current cost of equity is 14.23 percent.What is the firm's pretax cost of debt? Ignore taxes.

• A)6)45%
• B)6)03%
• C)6)55%
• D)6)40%
• E)6)63%