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A firm has $800 million in debt outstanding and $200 million in market value of equity. Its current debt/capital ratio is 80%. The firm is

A firm has $800 million in debt outstanding and $200 million in market value of equity. Its current debt/capital ratio is 80%. The firm is having trouble making its interest payments. If it sells a division with an estimated value of $100 million and uses the proceeds from sale to retire debt, what will the debt/capital ratio be after this transaction?

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