Question: Please show work and equations. I will give thumbs up if it is shown well. Thanks! The required return on equity for an all-equity firm

Please show work and equations. I will give thumbs up if it is shown well. Thanks!

The required return on equity for an all-equity firm is 10.0 percent. They are considering a change in capital structure to a debt-to-equity ratio of the tax rate is 40 percent, the pre-tax cost of debt is 8 percent. Find the new cost of capital if this firm changes capital structure.

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