A Firm Has a Debt-To-Equity Ratio of 1

question 77

Multiple Choice

A firm has a debt-to-equity ratio of 1.0.If it had no debt,its cost of equity would be 12%.Its cost of debt is 9%.What is its cost of equity if there are no taxes?

• A)21%
• B)18%
• C)15%
• D)16%

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