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Home / Questions / Skillet Industries has a debtâequity ratio of 18 Its WACC is 91 percent and its cost of de...

# Skillet Industries has a debtâequity ratio of 18 Its WACC is 91 percent and its cost of debt is 71 percent The corporate tax rate is 35 percent a What is the companyâs cost of equity

Skillet Industries has a debtâequity ratio of 1.8. Its WACC is 9.1 percent, and its cost of debt is 7.1 percent. The corporate tax rate is 35 percent.

a. What is the companyâs cost of equity capital? (Round your answer to 2 decimal places. (e.g., 32.16))

Cost of equity capital_________ %

b. What is the companyâs unlevered cost of equity capital? (Round your answer to 2 decimal places. (e.g., 32.16))

Unlevered cost of equity capital_________ %

c-1 What would the cost of equity be if the debtâequity ratio were 2? (Round your answer to 2 decimal places. (e.g., 32.16))

Cost of equity_________ %

c-2 What would the cost of equity be if the debtâequity ratio were 1.0? (Round your answer to 2 decimal places. (e.g., 32.16))

Cost of equity_________ %

c-3 What would the cost of equity be if the debtâequity ratio were zero? (Round your answer to 2 decimal places. (e.g., 32.16))

Cost of equity_______ %

Sep 06 2020 View more View Less