Question
15. If an all equity firm with $666,979 equity wants to issue debt and raise the debt ratio to 0.44 without any change in total
15. If an all equity firm with $666,979 equity wants to issue debt and raise the debt ratio to 0.44 without any change in total assets, by retiring some of the equity with the proceeds of the debt issue, how much to they need to borrow? Hint: Ask yourself what the total assets are of this all-equity firm before they issue any debt.?
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Corporate Finance
Authors: Jonathan Berk and Peter DeMarzo
3rd edition
978-0132992473, 132992477, 978-0133097894
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