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Business, 09.07.2021 01:00 tori829

Green Roof Foods currently has a debt-to-equity ratio of .63, its cost of equity is 13.6 percent, and its pretax cost of debt is 7.8 percent. The tax rate is 35 percent and the risk-free rate is 3.1 percent. The firm's preferred capital structure consists of 50 percent debt. What discount rate should be assigned to a new project the firm is considering if the project is equally as risky as the overall firm and will be financed solely with equity? a. 7.80%.
b. 9.76%.
c. 5.07%.
d. 9.34%.
e. 10.70%.

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Green Roof Foods currently has a debt-to-equity ratio of .63, its cost of equity is 13.6 percent, an...
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