A Global Conglomerate Has a Debt Beta of Zero

question 12

Multiple Choice

A global conglomerate has a debt beta of zero.If the cost of equity is 12.23 percent,and the risk-free rate is 4.36 percent,what is the firm's pretax cost of debt?

• A)4.36 percent
• B)8.30 percent
• C)7.87 percent
• D)0 percent
• E)12.23 percent

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