Fama's Llamas has a WACC of 9.4 percent. The company's cost of equity is 13 percent,...

 

 

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Fama's Llamas has a WACC of 9.4 percent. The company's cost of equity is 13 percent, and its pretax cost of debt is 6.7 percent. The tax rate is 22 percent. What is the company's target debt-equity ratio? Note: Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616. Fama's Llamas has a WACC of 9.4 percent. The company's cost of equity is 13 percent, and its pretax cost of debt is 6.7 percent. The tax rate is 22 percent. What is the company's target debt-equity ratio? Note: Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.

Answer rating: 100% (QA)

To find the companys target debtequity ratio well use the weighted average cost of capital WACC form... View the full answer