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NPH wants to increase capacity by 4 0 % with a $ 1 0 million investment in plant and machinery. The firm wants to maintain

NPH wants to increase capacity by 40% with a $10 million investment in plant and machinery. The firm wants to maintain the current debt-to-total-asset ratio in the capital structure of 40%. It also wants to maintain the past dividend policy of distributing 45% of last years income as dividends. Last years income was $5 million. How much external equity must NPH seek for the expansion?

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