Answer part c

- 4. Your firm has current period earnings available to common stockholders of $400 and a dividend payout ratio of 30%. Calculate the values for ARE, A Common Stock, and A Debt under the two theories below: 1. The pecking order theory, with no restriction on debt. 2. The static trade-off theory, with a target debt to total assets ratio of 40%. The necessary change in total assets is $1,000. co Same as part a, except the dividend payout ratio is now 10%. c. Same as part a, except the necessary change in total assets is $200. - 4. Your firm has current period earnings available to common stockholders of $400 and a dividend payout ratio of 30%. Calculate the values for ARE, A Common Stock, and A Debt under the two theories below: 1. The pecking order theory, with no restriction on debt. 2. The static trade-off theory, with a target debt to total assets ratio of 40%. The necessary change in total assets is $1,000. co Same as part a, except the dividend payout ratio is now 10%. c. Same as part a, except the necessary change in total assets is $200