Question: Part II. Short answer and calculation question II 1). Blue Ribbon Inc. wants to have a weighted average cost of capital of 10 percent. The

Part II. Short answer and calculation question II
Part II. Short answer and calculation question II 1). Blue Ribbon Inc. wants to have a weighted average cost of capital of 10 percent. The firm has an after- tax cost of debt of 4% and, according to the SML, a cost of equity of 12%. The corporate tax rate is 40%. What debt-equity ratio is needed for the firm to achieve their targeted weighted average cost of capital

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