Katy Corporation wants to have a weighted average cost of capital (WACC) of 10%. The cost of debt is 5%, the cost of equ
Posted: Thu May 19, 2022 7:16 am
Katy Corporation wants to have a weighted average cost of
capital (WACC) of 10%. The cost of debt is 5%, the cost of equity
is 12%, and the tax rate is 20%. There is no other capital except
the mentioned debt and equity. With the given information,
calculate the debt-equity ratio to achieve the targeted WACC.
capital (WACC) of 10%. The cost of debt is 5%, the cost of equity
is 12%, and the tax rate is 20%. There is no other capital except
the mentioned debt and equity. With the given information,
calculate the debt-equity ratio to achieve the targeted WACC.