Winter's Toyland has a debt-equity ratio of 1.00. The cost of debt is 8 percent and the required return on assets is 15 percent. What is the cost of equity if you ignore taxes? Write your answer as a percent rounded to two digits, but don't include the % sign (i.e. write 12.63, not 0.1263).

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Winter's Toyland has a debt-equity ratio of 1.00. The cost of debt is 8 percent and the required return on assets is 15 percent. What is the
cost of equity if you ignore taxes? Write your answer as a percent rounded to two digits, but don't include the % sign (i.e. write 12.63, not
0.1263).
Numeric Response
Transcribed Image Text:Winter's Toyland has a debt-equity ratio of 1.00. The cost of debt is 8 percent and the required return on assets is 15 percent. What is the cost of equity if you ignore taxes? Write your answer as a percent rounded to two digits, but don't include the % sign (i.e. write 12.63, not 0.1263). Numeric Response
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