What is the company target debt-equity ratio

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1. Bellingham bonds have an annual coupon rate of 6 percent and a par value of $1,000 and will mature in 15 years. If you require a return of 16 ?percent, what price would you be willing to pay for the? bond? What happens if you pay more for the? bond? What happens if you pay less for the? bond? (Round to the nearest? cent.)

2. Fama's Llamas has a weighted average cost of capital of 9 percent. The company's cost of equity is 16 percent, and its pretax cost of debt is 6 percent. The tax rate is 34 percent. What is the company's target debt-equity ratio?

Reference no: EM131923910

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