Business, 05.12.2019 18:31 LouieHBK

Situational software co. (ssc) is trying to establish its optimal capital structure. its current capital structure consists of 40% debt and 60% equity; however, the ceo believes that the firm should use more debt. the risk-free rate, rrf, is 3%; the market risk premium, rpm, is 7%; and the firm's tax rate is 40%. currently, ssc's cost of equity is 15%, which is determined by the capm. what would be ssc's estimated cost of equity if it changed its capital structure to 50% debt and 50% equity? round your answer to two decimal places. do not round intermediate steps.

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Situational software co. (ssc) is trying to establish its optimal capital structure. its current cap...