Compute the company target debt-equity ratio

Reference no: EM131972974

Question: Fama's Llamas has a weighted average cost of capital of 11 percent. The company's cost of equity is 15 percent, and its pretax cost of debt is 7.5 percent. The tax rate is 32 percent. What is the company's target debt-equity ratio? (Do not round your intermediate calculations.) The response must be typed, single spaced, must be in times new roman font (size 12) and must follow the APA format.

Reference no: EM131972974

Questions Cloud

Discuss what the tradeoffs are that prevent people : Discuss what the tradeoffs are that prevent people from using encryption more. Why might someone prefer to not encrypt their data?

Do you think the ehr makes physicians jobs easier : Do you think the EHR makes physicians' jobs easier, more difficult, or a combination of both? Explain your answer. Your initial post should be 3-4 paragraphs.

Find what is cash flow under the current capital structure : Melanie, a shareholder of the firm, owns 160 shares of stock. What is her cash flow under the current capital structure, assuming the firm has a dividend payout

How the data could be incorrect by the time it is submitted : Select one of the data elements that is utilized in the UHDDS Data Set and discuss your insight on how this data could be incorrect by the time it is submitted.

Compute the company target debt-equity ratio : Fama's Llamas has a weighted average cost of capital of 11 percent. The company's cost of equity is 15 percent, and its pretax cost of debt is 7.5 percent.

Wrirte explanation of some beliefs and traditions of culture : Write a brief explanation of some beliefs and traditions of the culture. The above elements can either be included on one page of your website or separated.

Should the stock price currently be perceived : A family-member is interested in buying the stock of a company that currently trades at $80/share. Use and explain the model if the stock's current annual.

What factors contributed to kathy hudson decision : What factors contributed to Kathy Hudson's decision to outsource data center, telecommunications, and PC services to IBM, DEC, and BusinessLand?

Determine the maximum flame temperature : Determine the maximum flame temperature - Determine the 'furnace efficiency' if the flue gases leave the boiler at 300°C

User Account

All Pages