What is the firm debt-equity ratio

Assignment Help Financial Management
Reference no: EM131568761

The Texas Inc. has a cost of equity of 16.5 percent and a pre-tax cost of debt of 9.4 percent. The firm's target weighted average cost of capital is 13 percent and its tax rate is 30 percent. What is the firm's debt-equity ratio?

Reference no: EM131568761

Questions Cloud

Main entities or objects of the business function : Describe the main entities or objects of the business function / operation. Specify the attribute that would be the primary key for each entity
How did the minoans treat the exterior of their buildings : During the Old Palace period, how did the Minoans treat the exterior of their buildings. Why is their technique significant in history.
What is the expected return on this portfolio : What is the expected return on this portfolio?
How did the black death affect the muslim world : hat changes in literature and art came about in Europe as a result of the Black Death? How did the Black Death affect the Muslim world?
What is the firm debt-equity ratio : The firm's target weighted average cost of capital is 13 percent and its tax rate is 30 percent. What is the firm's debt-equity ratio?
Decrease the after-tax cost of debt for firm : Which one of the following will decrease the after-tax cost of debt for a firm?
Begin saving for retirement-future value of an annuity : Your client is 24 years old; and she wants to begin saving for retirement, If she follows your advice, how much money will she have at 65?
Define which columns represent the premises : Use truth tables to determine whether the argument forms are valid. Indicate which columns represent the premises and which represent the conclusion.
Human personality that are considered innate : What are some characteristics of human personality that are considered innate. What are characteristics that are considered to be socialized or learned

Reviews

Write a Review

Financial Management Questions & Answers

  Create a bubble chart of given data

Create a bubble chart of this data, with Home Value on the vertical axis, Population Density on the horizontal axis, and Median Income represented by the size of the bubble.

  What is the equivalent annual cost of machine

Deniro's, Inc. is analyzing two machines to determine which one they should purchase. The company requires a 14 percent rate of return and uses straight-line depreciation to zero book value with no salvage value. What is the equivalent annual cost of..

  Pro forma income statement for organization

Make a three year Pro Forma income statement for your organization (or product/service) and include information on your financial break-even point?

  How does a current account deficit benefit u.s. citizens

What is a current account deficit? Specifically, what does it mean that the U.S. isrunning a current account deficit? How does a current account deficit benefit U.S. citizens? Howdoes a current account deficit hurt U.S. citizens?

  Issue new stock to finance its capital budget

What is the firm's WACC, assuming it must issue new stock to finance its capital budget?

  What is the projects discounted payback period

NPV Project K costs $52,125, its expected cash inflows are $12,000 per year for 8 years, and its WACC is 12%. What is the project’s NPV? Problem 11-5 What is the project’s discounted payback period?

  Important to regulate and control the supply of money

Why does it seem to be important to regulate and control the supply of money? Why might an investor find a zero-coupon bond an attractive investment?

  What is effective annual rate of interest on loan

You are considering credit card with quoted rate of interest of 15.99% per year, compounded monthly. What is effective annual rate of interest on loan.

  Assume market interest rate stays the same after one year

Consider a bond paying a coupon rate of 8% per year annually when the market interest rate is 6% per year. Assume market interest rate stays the same after 1 ye

  What is the terminal or horizon-value of operations

Kendra Enterprises has never paid a dividend. Free cash flow is projected to be $80,000 and $100,000 for the next 2 years, respectively; after the second year, FCF is expected to grow at a constant rate of 5%. What is the terminal, or horizon, value ..

  Find the expected rate of inflation during the next year

Given the following data, find the expected rate of inflation during the next year. r*, the real risk-free rate= 3% maturity risk premium on 10-year Treasury bonds=2%, but zero on 1-year bonds default risk premium on 10-year, A-rated bonds=1.5% liqui..

  Calculate the approximate yield-to-maturity of the bonds

Portland Company wants to issue discount bonds with a market value equal to 76% of their face value. The bonds will carry 5% coupon, paying interest semiannually, and they will mature after 10 years. The income tax rate of Portland is 30%. Calculate ..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd