Solve for the post-tax cost of debt

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Tattered Books has a WACC of 13.6 percent and a cost of equity of 16.1 percent. What is the after-tax cost of debt if the debt-equity ratio is 0.40? (Hint: First find the weights of debt and equity using the debt-equity ratio and then plug them into the formula for WACC. Then solve for the post-tax cost of debt.) a. 7.24 percent b. 7.35 percent c. 7.49 percent d. 7.53 percent e. 7.68 percent

Reference no: EM131055748

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Solve for the post-tax cost of debt : Tattered Books has a WACC of 13.6 percent and a cost of equity of 16.1 percent. What is the after-tax cost of debt if the debt-equity ratio is 0.40? (Hint: First find the weights of debt and equity using the debt-equity ratio and then plug them into ..

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