Swirlpool, Inc

question 27

Multiple Choice

Swirlpool, Inc. has a WACC of 11%, cost of debt of 8%, and a cost of equity of 12%. What must the debt-to-equity ratio be?

• A) 1/2
• B) 1/4
• C) 1/6
• D) 1/3

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Definitions:

Dollar

The official currency of the United States, also used as a standard monetary unit in many other countries.

U.S. Net Capital Outflow

The difference between the purchase of foreign assets by U.S. citizens and the purchase of U.S. assets by foreigners, reflecting the flow of capital from and into the U.S.

U.S. Saving

The portion of income that individuals, businesses, and the government in the United States set aside rather than spending it immediately.

National Saving

The sum of private and public savings in a country, representing the total income remaining after expenditures on goods and services.