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Home / Questions / Kose Inc has a target debtequity ratio of 120 Its WACC is 86 percent and the tax rate is 3...

Kose Inc has a target debtequity ratio of 120 Its WACC is 86 percent and the tax rate is 35 percent a If Koses cost of equity is 16 percent what is its pretax cost of debt b If instead

Kose, Inc., has a target debt–equity ratio of 1.20. Its WACC is 8.6 percent, and the tax rate is 35 percent.

a. If Kose’s cost of equity is 16 percent, what is its pretax cost of debt?

b. If instead you know that the aftertax cost of debt is 3.5 percent, what is the cost of equity?

Apr 01 2020 View more View Less

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