4. (10 points, each question has 2 points)
Pleasc write down the right choice for each question.
【題組】(3) Based on M&M model, A firm has a debt-to-equity ratio of 1.0. If it had no debt, its cost of
equity would be 15%. Its cost of debt is 10%. What is its cost of equity if there are no taxes or
other imperfections? (A)21%. (B)18%. (C)15%. (D)20%.