What is the companys target debt-equity ratio

Assignment Help Financial Management

Reference no: EM13922193

Fama’s Llamas has a weighted average cost of capital of 10.1 percent. The company’s cost of equity is 13 percent, and its pretax cost of debt is 8.1 percent. The tax rate is 40 percent. What is the company’s target debt−equity ratio?

Reference no: EM13922193

Questions Cloud

What is amount to use as the annual sales figure : Winnebagel Corp. currently sells 28328 motor homes per year at $65824 each, and 11079 luxury motor coaches per year at $104355 each. The company wants to introduce a new portable camper to fill out its product line; it hopes to sell 21673 of these ca..

Sales representative be articulate, sophisticated : Your job is to hire a sales manager to sell your latest fiber optics to leading wireless manufacturers of five key companies. This job requires that the sales representative be articulate, sophisticated, and knowledgeable about fiber optics. The j..

Explain the practice of fasting during the month of ramadan : The Islamic vision of the good life requires that, Islamic law dictates that a man may marry as many as four wives, on the condition that and Explain the practice of fasting during the month of Ramadan

Implications for supply chain design : Compare and contrast the implications for supply chain design for these two retail systems.

What is the companys target debt-equity ratio : Fama’s Llamas has a weighted average cost of capital of 10.1 percent. The company’s cost of equity is 13 percent, and its pretax cost of debt is 8.1 percent. The tax rate is 40 percent. What is the company’s target debt−equity ratio?

Incidents of criminal prosecution, convictions : Topic 3: According to the U.S. Justice Department, in 2003 about 10.4 percent of all African American men between ages 25 to 29 were incarcerated, as compared to 2.4 percent of Hispanic men and 1.2 percent of Non-Hispanic White men. What is going ..

Index futures contract at a futures price : On January 1, you sold one April S&P 500 Index futures contract at a futures price of 895. If the April futures price is 800 on February 1, your profit would be __________ if you close your position.

About the future value of an annuity : Your client is 29 years old; and she wants to begin saving for retirement, with the first payment to come one year from now. She can save $9,000 per year; and you advise her to invest it in the stock market, which you expect to provide an average ret..

Paper based on best instructional practices : You will write a scholarly paper based on best instructional practices. Frame your paper so that you are focused on a specific context (e.g. high school biology) so that you are able to generate ideas for application as your write your paper.

User Account

All Pages