Spartan Ltd Has an Unlevered Cost of Capital of 11%,a

question 54

Multiple Choice

Spartan Ltd has an unlevered cost of capital of 11%,a cost of debt of 8%, and a tax rate of 35%.What is the target debt-equity ratio if the targeted cost
Of equity is 12%?

• A).44
• B).49
• C).51
• D).56
• E).62

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Definitions:

Genetic Material

The DNA or RNA present in cells which codes for genetic information necessary for the development, functioning, and reproduction of living organisms.

Endospore

A resting cell formed by certain bacteria; highly resistant to heat, radiation, and disinfectants.

Cell Membrane

The semipermeable membrane surrounding the cytoplasm of a cell, controlling the passage of substances in and out of the cell.

Lyses

The breakdown or decomposition of cells by rupture of the cell wall or membrane.