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Olympic Lanes is currently worth 5 million dollars and is all equity-financed. The company's current cost of equity is 11% Olympic Lanes would like to

Olympic Lanes is currently worth 5 million dollars and is all equity-financed. The company's current cost of equity is 11% Olympic Lanes would like to issue debt worth 1 million dollars with a cost of debt of 4%. Assuming the Modigliani-Miller Theories hold perfectly.



What will Olympic Lanes' new cost of equity after issuing the debt?

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