Debt-equity ratio-targeted weighted average cost of capital

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Phil's Carvings, Inc. wants to have a weighted average cost of capital of 8.3 percent. The firm has an after tax cost of debt of 6.1 percent and a cost of equity of 12.2 percent. What debt-equity ratio is needed for the firm to achieve their targeted weighted average cost of capital?

1.56

0.56

2.77

1.77

0.89

Reference no: EM13826802

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