Mountain Groves has an unlevered cost of capital of 13.2 percent, a cost of debt of 8.3 percent, and a tax rate of 21 percent. What is the target debt-equity ratio if the targeted cost of equity is 14.5 percent?
A) .54
B) .29
C) .34
D) .48
E) .33

Question

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The Answer of Mountain Groves has an unlevered cost of capital of 13.2 percent, a cost of debt of 8.3 percent, and a tax rate of 21 percent. What is the target debt-equity ratio if the targeted cost of equity is 14.5 percent?
A) .54
B) .29
C) .34
D) .48
E) .33

Mountain Groves Has an Unlevered Cost of Capital of 13