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Is the decision to raise approximately $20 million to finance the new division exclusively using new equity likely to affect HKs WACC? Explain why or
Is the decision to raise approximately $20 million to finance the new division exclusively using new equity likely to affect HKs WACC? Explain why or why not in terms of financial leverage, component costs, and capital structure. What is the likely impact? (Note: A recalculation of the WACC is not required for this question.)
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