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What is the company target debt-equity ratio

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Reference no: EM131142011

Fama’s Llamas has a weighted average cost of capital of 10.2 percent. The company’s cost of equity is 14 percent and its pretax cost of debt is 8.4 percent. The tax rate is 35 percent. What is the company’s target debt-equity ratio?

Reference no: EM131142011

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What is the company target debt-equity ratio : Fama’s Llamas has a weighted average cost of capital of 10.2 percent. The company’s cost of equity is 14 percent and its pretax cost of debt is 8.4 percent. The tax rate is 35 percent. What is the company’s target debt-equity ratio?
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