Solution-Target weighted average cost of capital

Target weighted average cost of capital

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A company wants to achieve a weighted average cost of capital of 11.32%. The company has a before-tax cost of debt of 9.42% and a cost of equity of 13.22%. If the tax rate is 34%, what debt-to-equity ratio is needed for the company to achieve its target weighted average cost of capital?

Reference no: EM132578081

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Target weighted average cost of capital : If the tax rate is 34%, what debt-to-equity ratio is needed for the company to achieve its target weighted average cost of capital?

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Target weighted average cost of capital

Reference no: EM132578081

Reference no: EM132578081

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