A Firm Has an Expected Return on Equity of 14

question 79

Multiple Choice

A firm has an expected return on equity of 14% and an after-tax cost of debt of 6%.What debt-equity ratio should be used in order to keep the WACC at 10%?

• A)1.00
• B)0.75
• C)0.50
• D)0.25

---

Definitions:

Input Technologies

Technologies that allow users to input data into a computer or other digital devices, including keyboards, mice, and touchscreens.

Instructions

Directions or orders given by one entity to another, detailing how tasks should be performed or operations conducted.

Computer

An electronic device capable of processing data according to a set of instructions to produce outputs.

Secondary Storage

Non-volatile storage that holds data permanently until it is deleted or overwritten, often used for data backup and archiving.