A firm finances with both bonds and common equity, but does not wish to issue any new common stock during the coming year due to sub-optimal market conditions. It has committed to maintaining the dividend at the projected level. Given these constraints and the following information, what percentage of the capital budget must be financed with debt? Projected capital budget Common shares outstanding $750,000 500,000 Nominal cost of debt 12.25% State + federal tax rate 25% Projected dividend per share $3.25 Projected EPS $4.50 Edit View Insert Format Tools Table Help BIAV P = > 1