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Company X has $300 sales, variable cost=60% of sales, fixed cost=$40, equity=50%, debt=50%, total debt= 100$, interest rate on debt=12%, tax rate bracket= 40%, #
Company X has $300 sales, variable cost=60% of sales, fixed cost=$40, equity=50%, debt=50%, total debt= 100$, interest rate on debt=12%, tax rate bracket= 40%, # of common stock=5, the firm has decided to distribute 885 % of its income as dividends: PS div.= 10%. Cost of common stock= 15.5%, growth rate=0. Using these details, the stock price will equal_ _and the company will issue new stocks. assume that the current market stock price is $40. Select one: a. $52, issue b. $43, not issue c. $41.9, not issue d. $43, issue e. $41.9, issue
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