Problem:
The Five & Dime store has a cost of equity of 15.8%, a pretax cost of 7.7%, and a tax rate of 35%.
Requirement:
Question: What is the firm's weighted average cost of capital if the debt-equity ratio is 0.40?
- 10.18
- 11.72
- 12.72
- 13.49
- 14.93
Note: Show all workings.