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Axon Industries needs to raise $2,500,000 USDs for a new investment project. If the firm issues 1-year debt, it may have to pay an interest
Axon Industries needs to raise $2,500,000 USDs for a new investment project. If the firm issues 1-year debt, it may have to pay an interest rate of 10%, although Axon's managers believe that 8% would be a fair rate given the level of risk. If the firm issues equity, they believe the equity may be underpriced by 10%.What is the cost (in USDs) to current shareholders of financing the project out of debt? Note: Express your answers in strictly numerical terms. For example, if the answer is $500, enter 500 as an answer.
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