Your firm has a debt-equity ratio of .75. Your pre-tax cost of debt is 8.5% and your required return on assets is 15%. What is your cost of equity if you ignore taxes? A. 11.25% B. 12.21% C. 16.67% D. 19.88% E. 21.38% A. :D B. 程度:难 C. 解析:Re = .15 + (.15 - .085) ´ .75 = .19875 = 19.88% D. :单选题 E. 、Bigelow, Inc. has a cost of equity of 13.56% and a pre-tax cost of debt of 7%. The required return on the assets is 11%. What is the firm's debt-equity ratio based on MM Proposition II with no taxes? A. 60 B. 64 C. 72 D. 75 E. .80