Harper Corp. has 3 million shares outstanding at a market price of $10/share. They have 10,000 bonds

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Harper Corp. has 3 million shares outstanding at a market price of $10/share. They have 10,000 bonds outstanding, each with a par value of $1000. The current market price is $950. The annual coupon rate on the bonds is 6%. EBIT for the year is $4,500,000.

What is the degree of financial leverage (DOFL)? [Choose closest]

A.0.866
B.0.317
C.1.317
D.1.154

Posted Date: Jun 05, 2024 09:07 PM

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Harper Corp. has 3 million shares outstanding at a market price of $10/share. They have 10,000 bonds

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