Question: Trident Hotels has debt with both a face and a market value of $ 2 2 7 , 0 0 0 . This debt has

Trident Hotels has debt with both a face and a market value of $227,000. This debt has a coupon rate of 7 percent and pays interest annually. The expected earnings before interest and taxes is $87,200, the tax rate is 21 percent, and the unlevered cost of capital is 12 percent. What is the firms cost of equity?
A)13.25 percent
B)13.89 percent
C)13.92 percent
D)14.27 percent

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