Question

Malkin Corp. has no debt but can borrow at 6.5 peecent. The firms WACC is currently...

Malkin Corp. has no debt but can borrow at 6.5 peecent. The firms WACC is currently 10 percent, and there is no corporate tax.
a. what is the company's cost of equity?
b. If the firm converts to 30 percent debt. what will its cost of equity be?
c. If the firm converts to 55 percent debt, what will its cost of equity be?
d. What is the companys WACC in parts (b) and (c) ?
30 percent. WACC= %
55 percent. WACC= %

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