Anderson's Furniture Outlet has an unlevered cost of capital of 10%, a tax rate of 34%, and expected earnings before interest and taxes of €1,600.The company has €3,000 in bonds outstanding that have an 8% coupon and pay interest
Annually.The bonds are selling at par value.What is the cost of equity?
A)8.67%
B)9.34%
C)9.72%
D)9.99%
E)10.46%

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The Answer of Anderson's Furniture Outlet has an unlevered cost of capital of 10%, a tax rate of 34%, and expected earnings before interest and taxes of €1,600.The company has €3,000 in bonds outstanding that have an 8% coupon and pay interest
Annually.The bonds are selling at par value.What is the cost of equity?
A)8.67%
B)9.34%
C)9.72%
D)9.99%
E)10.46%

Anderson's Furniture Outlet Has an Unlevered Cost of Capital of 10