A Firm's Return on Assets Is 12% and the Cost

question 13

Multiple Choice

A firm's return on assets is 12% and the cost of the firm's debt is 7%.Given a 0.7 debt to equity ratio,what is the levered cost of equity?

• A)7.0%
• B)12.0%
• C)13.6%
• D)15.5%

---

Definitions:

Neural Tube

The hollow, longitudinal structure in the early vertebrate embryo that gives rise to the brain and spinal cord. The neural tube forms from the neural plate, a flattened, thickened region of the ectoderm that rolls up and sinks below the surface.

Neural Plate

The flat layer of embryonic ectodermal cells that develops into the nervous system, including the brain and spinal cord.

Neural Fold

Embryonic structure that folds to form the neural tube, which later develops into the central nervous system in vertebrates.

Thalamus

The part of the vertebrate brain that serves as a main relay center, transmitting information between the spinal cord and the cerebrum.