Compute weight average cost of capital

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Eleven-7 Inc. has 12,500 shares of outstanding shares, being sold at $42 per share. The book value of equity equals $400,000. The face value of debt equals $250,000. The debt is currently quoted at 101.2% of the face value. Based on the above information, which of the following should be used as the equity ratio (i.e., weight of equity) to compute weight average cost of capital?

Reference no: EM132585479

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