Weigthed average cost of capital-hat is the cost of equity

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The firm is financed by 40% of debt and 60% of equity. It has the weigthed average cost of capital of 15%. The cost of equity is 25%. What is the cost of debt? Assume that there are no taxes.And think about another situation. The firm is financed by 40% of debt and 60% of equity. It has the weigthed average cost of capital of 15%. The cost of debt is 8%. What is the cost of equity? Assume that there are no taxes. Please answer the questions with two parts.

Reference no: EM132036957

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