A Firm Has a Weighted Average Cost of Capital of 11.68

question 82

Multiple Choice

A firm has a weighted average cost of capital of 11.68 percent and a cost of equity of 15.5 percent.The debt-equity ratio is 0.65.There are no taxes.What is the firm's cost of debt?

• A)5.80 percent
• B)6.27 percent
• C)6.44 percent
• D)7.23 percent
• E)7.81 percent