10 An unlevered firm has a cost of capital of 12.46 percent and a tax rate of 35 percent. The firm is considering a new capital structure with 35 percent debt. The interest rate on the debt would be 6.68 percent. What would be the firm's levered cost of capital? A, 14.27% B. 14.78% C. 14.48% D. 13.90%
10 An unlevered firm has a cost of capital of 12.46 percent and a tax rate of 35 percent. The firm is considering a new capital structure with 35 percent debt. The interest rate on the debt would be 6.68 percent. What would be the firm's levered cost of capital? A, 14.27% B. 14.78% C. 14.48% D. 13.90%
Chapter12: The Cost Of Capital
Section: Chapter Questions
Problem 7P
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