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A firm that is worth $1 million and is financed with 30% risk-free debt and 70% equity, grows in value to $1.5 million. What is
A firm that is worth $1 million and is financed with 30% risk-free debt and 70% equity, grows in value to $1.5 million. What is its new debt/equity ratio?
A. 20%
B. 25%
C. 26.3%
D. 33.33%
E. 66.67%
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