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Assume no taxes or other frictions. Manufacturing Master Inc. ( MMI ) is an established manufacturing firm with a steadily growing free cash flow. In
Assume no taxes or other frictions. Manufacturing Master Inc. MMI is an established manufacturing firm with a steadily growing free cash flow. In particular, the free cash flow next year year is expected to be $ million, and subsequent growth is expected to be a year perpetually. The free cash flow is all paid out. Currently year MMI is all equity financed, with a cost of capital of The riskfree interest rate is for all maturities. MMI now decides to issue a new debt to buy back part of its equity. The new debt takes the form of a consol bond, paying $ million per year forever. The new debt is riskfree, given MMIs future cash flows. Question : Next year year after the payout to its equity and debt holders, what is MMIs debt to equity ratio? i got the answer as but the ANSWER solution is and it ONLY SHOULD BE DO NOT ATTEMPT TO ANSWER MY QUESTION IF YOU CAN NOT FIND EXACT OR VERY CLOSE ANSWER "DIFFERENCE ONLY FROM DO NOT USE CHATGPT, I WILL REPORT YOU! IF YOU CAN'T FIND EXAM ANSWER, DO NOT ATTEMPT TO ANSWER IT
Assume no taxes or other frictions. Manufacturing Master Inc. MMI is an established manufacturing firm with a steadily growing free cash flow. In particular, the free cash flow next year year is expected to be $ million, and subsequent growth is expected to be a year perpetually. The free cash flow is all paid out. Currently year MMI is all equity financed, with a cost of capital of The riskfree interest rate is for all maturities.
MMI now decides to issue a new debt to buy back part of its equity. The new debt takes the form of a consol bond, paying $ million per year forever. The new debt is riskfree, given MMIs future cash flows.
Question : Next year year after the payout to its equity and debt holders, what is MMIs debt to equity ratio?
i got the answer as but the ANSWER solution is and it ONLY SHOULD BE DO NOT ATTEMPT TO ANSWER MY QUESTION IF YOU CAN NOT FIND EXACT OR VERY CLOSE ANSWER "DIFFERENCE ONLY FROM
DO NOT USE CHATGPT, I WILL REPORT YOU! IF YOU CAN'T FIND EXAM ANSWER, DO NOT ATTEMPT TO ANSWER IT
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