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A companys target capital structure is 60% debt and 40% equity. The company expects net income next year of $6 million and the company expects
A companys target capital structure is 60% debt and 40% equity. The company expects net income next year of $6 million and the company expects to have positive net present value projects that will require an investment of $15 million. If the company maintains its current dividend payout ratio of 70%, how much external equity financing will the company need to be able to pursue all of its positive net present value projects?
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