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The business risk of a companv: has a positive relationship with the company's cost of...

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Accounting

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The business risk of a companv: has a positive relationship with the company's cost of equity O is inversely related to the required return on the company's assets. O is dependent upon the relative weights of the debt and equity used to finance the company. O has no relationship with the required return on a company's assets according to M&M theory. O depends on the company's level of unsystematic risk. Ignoring taxes, Pewter & Glass has a weighted average cost of capital of 10.82 percent The company can borrow at 7.4 percent. What is the cost of equity if the debt-equity ratio is .68? 12.49% 13.15% 12.87% 11.09% 15.85%

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