Target debt-equity ratio-what is the cost of equity

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Reference no: EM13922145

Frye, Inc., has a target debt-equity ratio of 1.60. Its WACC is 9.9 percent, and the tax rate is 38 percent. If the company's cost of equity is 16 percent, what is its pretax cost of debt? If instead you know that the aftertax cost of debt is 6.6 percent, what is the cost of equity? Please round answers to 2 decimal places and show each step.

Reference no: EM13922145

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Target debt-equity ratio-what is the cost of equity : Frye, Inc., has a target debt-equity ratio of 1.60. Its WACC is 9.9 percent, and the tax rate is 38 percent. If the company's cost of equity is 16 percent, what is its pretax cost of debt? If instead you know that the aftertax cost of debt is 6.6 per..

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