Given the following information, calculate the cost of equity capital. EBIT = $2,7500,000 Debt = $2,

Given the following information, calculate the cost of equity capital.

EBIT = $2,7500,000
Debt = $2,000,000
Required return on unlevered firm = 22%
Required return on debt = 11%
Marginal tax rate = 35%

20.25%

21.13%

16.5%

22%

24.09%

 

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