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Explain your reasoning. An investor owns 500 shares of stock in a Montreal firm with a debt/equity ratio = 1.0. The investor prefers a debt/equity

Explain your reasoning.

 

An investor owns 500 shares of stock in a Montreal firm with a debt/equity ratio = 1.0. The investor prefers a debt/equity ratio = 1.5. If the stock price is $2 per share, what should the investor do?

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To achieve the desired debtequity ratio of 15 the investor would need to increase the amount of debt ... blur-text-image

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