Jungle,Inc

question 18

Multiple Choice

Jungle,Inc.has a target debt-equity ratio of 0.72.Its WACC is 11.5 percent and the tax rate is 34 percent.What is the cost of equity if the aftertax cost of debt is 5.5 percent?

• A)13.75 percent
• B)13.84 percent
• C)14.41 percent
• D)14.79 percent
• E)15.82 percent