Weston Industries has a debt–equity ratio of 1.2. Its WACC is 8.4 percent, and its cost of debt is 7.3 percent. The corporate tax rate is 35 percent.
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What is Weston’s unlevered cost of equity capital? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
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| Unlevered cost of equity capital: |
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What would the cost of equity be if the debt–equity ratio were 2? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
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What would the cost of equity be if the debt–equity ratio were 1.0? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
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What would the cost of equity be if the debt–equity ratio were zero? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
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