Caddie Manufacturing has a target debt-equity ratio of .95. Its cost of equity is 11 percent, and its pretax cost of debt is 7 percent. If the tax rate is 24 percent, what is the company’s WACC?

8.20%

Explanation:

Debt equity ratio = 0.95

or

Debt = 0.95 × equity

Cost of equity, ke = 11% or 0.11

Pretax cost of debt, kd = 7% or 0.07

Tax rate = 24% or 0.24

Therefore;

WACC = {Weight of equity × ke } + {Weight of debt × kd × (1-Tax rate)}

It is to be noted that ;

Weight of equity = Equity ÷ (Debt + Equity)

= Equity ÷ ( 0.95×Equity + Equity)

=1 ÷ 1.95

=0.513

Also,

Weight of debt = Debt ÷ ( Debt + Equity)

=0.95 × Equity ÷ ( 0.95 × Equity + Equity)

= 0.95 ÷ 1.95

=0.487

Hence,

WACC = {0.513 × 0.11} + {0.487 × 0.07 × (1-0.24)}

= {0.05643} + {0.03409 × 0.76}

= 0.0823384

or

0.0823384 × 100%

=8.23384

=8.20%

start by isolating the variable on one side by adding 43w^2 to both sides.   the equation will read:

25w^2+5=0

*subtract 5 from both sides*

25w^2=-5

*divide both sides by 25*

w^2=-1/5

*take the square root of both sides*

w=√(-1/5)

the square root of -1 is i.   the square root of 5 remains √5

the answer is i/√5.

hope this

idk the answer so dont listen to me but 23