Sunshine corporation's capital structure has a maximum capacity of 60% debt. Their cost of debt is 4% their cost of equity is 10% and their tax rate is 21% what percent of equity would optimize sunshine corporation's WACC,
I believe the answer is 5.89 but i am unsure. If that is incorrect how would I go about solving this problem?
WACC=(60%*4%)(1-0.21)+(0%)+(40%*10%)=5.896... View the full answer