The Tree House has a pretax cost of debt of 7.9 percent and a return on assets of 11.7 percent.The debt-equity ratio is 0.50.Ignore taxes.What is the cost of equity?
A) 11.87 percent
B) 12.33 percent
C) 12.47 percent
D) 12.98 percent
E) 13.60 percent
Correct Answer:
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