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Targeted weighted average cost of capital

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Puma desires a weighted average cost of capital of 13 percent. The firm has an after-tax cost of debt of 4.8 percent and a cost of equity of 15.4 percent. What debt-equity ratio is needed for the firm to achieve its targeted weighted average cost of capital?

-.37

-.29

-.56

-.34

-.44

The cost of equity consisted thoroughly of preferred stocks is calculated similar to the:

-pretax cost of debt.

-rate of return on a perpetuity.

-rate of return on an annuity.

-cost of an irregular growth common stock.

-after-tax cost of debt

Reference no: EM133110313

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