The DENC Corporation has the unlevered cost equity of 10%. The company wants to expand its operation by issuing new debt. If the cost of debt for the company is 6% and the corporate tax rate is 30%....

Extracted text: The DENC Corporation has the unlevered cost equity of 10%. The company wants to expand its operation by issuing new debt. If the cost of debt for the company is 6% and the corporate tax rate is 30%. What must be the debt-equity ratio of the company if the targeted cost of equity is 12%? Calculate the debt-equity (D/E) ratio. (A) The debt-equity (D/E) ratio is 0.50 (B) The debt-equity (D/E) ratio is 0.60 (C) The debt-equity (D/E) ratio is 2.80 (D) The debt-equity (D/E) ratio is 0.71