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Assume capital markets are perfect (i.e. the Modigliani-Miller Theorems hold). The Cat Nap Pet Stores capital structure is currently comprised of 20 million dollars
Assume capital markets are perfect (i.e. the Modigliani-Miller Theorems hold). The Cat Nap Pet Stores capital structure is currently comprised of 20 million dollars of debt and 12 million dollars of equity. If the firm issues 4 million dollars in new debt, what will the value of the company's equity be after the issuance of the new debt?
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