What would cost of equity be if debt–equity ratio were zero

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Crosby Industries has a debt–equity ratio of 1.1. Its WACC is 13 percent, and its cost of debt is 4 percent. There is no corporate tax. a. What is the company’s cost of equity capital? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Cost of equity 22.75 % b. What would the cost of equity be if the debt–equity ratio were 2? (Do not round intermediate calculations and enter your answer as a percent rounded to the nearest whole number, e.g., 32.) Cost of equity % What would the cost of equity be if the debt–equity ratio were .5? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Cost of equity % What would the cost of equity be if the debt–equity ratio were zero? (Do not round intermediate calculations and enter your answer as a percent rounded to the nearest whole number, e.g., 32.) Cost of equity %

Reference no: EM132017844

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