Last year, Arbor Corporation reported the following:

Balance Sheet

Total Assets $ $800,000$

Total Liabilities $500,000$

Total Shareholders' Equity $ $300,000$

This year, Arbor is considering whether to issue more debt to fund a $$100,000$ project or to issue additional shares of common stock. Both options will bring in exactly $$100,000.$ Arbor's current debt contracts contain a debt covenant that requires it to maintain a debt$-$to$-$equity ratio of $2\mathrm{.}0$ or less.

Required:

Calculate Arbor's current debt$-$to$-$equity ratio.

Calculate Arbor's debt$-$to$-$equity ratio assuming it funds the project using additional debt.

Calculate Arbor's debt$-$to$-$equity ratio assuming it funds the project by issuing common stock.