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Epiphany is an all-equity firm with an estimated market value of $300,000. The firm sells $150,000 of debt and uses the proceeds to purchase outstanding

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Epiphany is an all-equity firm with an estimated market value of $300,000. The firm sells $150,000 of debt and uses the proceeds to purchase outstanding equity Compute the weight in equity and the weight in debt after the proposed financing and repurchase of equity O A. 0.3, 0.7 OB. 0.35,0.65 OC. 0.25.0.75 OD. 0.5, 0.5 Grade see Consider the following returns: Year-End 2000 2001 2002 2003 2004 2005 Lowes Realized Return 20.4% 72.7% - 25.7% 56.9% 6.7% 17.9% Home Depot Realized Return - 14.6% 4.8% - 58.1% 71% 17.3% 0.9% IBM Realized Return 0.2% -32% - 27.0% 27.9% -5.1% - 11.3% The covariance between Lowes' and Home Depot's returns is closest to O A. 0.12 OB. 01 OC. 031 OD. 073

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