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A company is planning to buy a machine worth $550000. It is currently able to borrow money at the rate of 4.20% or it can
A company is planning to buy a machine worth $550000. It is currently able to borrow money at the rate of 4.20% or it can issue equity in the form of shares(consider $3 per share). The company has already a debt of 90% equity. Should the company buy take a loan to buy the machine or offer shares instead? Do a quantitative analysis. Note: Assumptions can be done on some values if required
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