Situational Software Co. (SSC) is trying to establish its optimal capital structure. Its current capital...
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Situational Software Co. (SSC) is trying to establish its optimal capital structure. Its current capital structure consists of 30% debt and 70% equity; however, the CEO believes that the firm should use more debt. The risk-free rate, rap, is 5%; the market risk premium, RPM, is 6%, and the firm's tax rate 1540% currently SSC cost of equity is 13%, which is determined by the CAPM. The data has been collected in the Microsoft Excel Online hile below. Open the spreadsheet and perform the required analysis to answer the question below. HHH Open spreadsheet What would be SSC estimated cost of equity if it changed its capital structure to 50% debt and equity Round your answer to two decimal places Do not round intermediate steps
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