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i need help on this corporate finance question please 2. Funny Bear Company has 40% debt and 60% equity, as optimal capital structure. Their stock
i need help on this corporate finance question please
2. Funny Bear Company has 40% debt and 60% equity, as optimal capital structure. Their stock price is $60, last dividend distributed was $6.5, growth rate is expected as 7%, corporate tax rate is 20% and flotation costs are 10%. They can borrow at 10% rate up to $15 million, above which interest rate rises to 12%. Their expected net income for next year is $27 million, and 45% will be distributed as dividends. They have three projects under analysis: A has 17 million cost. 18% IRR, B has 30-million cost and 16% IRR and C has 15 million cost and 14% IRR. a. Please calculate component costs, and break point(s). b. Please calculate WACC's! C. What will be the optimal capital budget? doar of $15 and fived Step by Step Solution
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