The Upper Tier has a current debt-equity ratio of.52 and a target debt-equity ratio of.45. The cost of floating equity is 9.5 percent and the floatation cost of debt is 6.6 percent. What should the firm use as their weighted average floatation cost?
A) 8.01%
B) 8.52%
C) 8.33%
D) 7.76%
E) 8.60%

Question

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The Answer of The Upper Tier has a current debt-equity ratio of.52 and a target debt-equity ratio of.45. The cost of floating equity is 9.5 percent and the floatation cost of debt is 6.6 percent. What should the firm use as their weighted average floatation cost?
A) 8.01%
B) 8.52%
C) 8.33%
D) 7.76%
E) 8.60%

The Upper Tier Has a Current Debt-Equity Ratio Of