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P 1 1 - 4 Roberson Fashion's capital structure consists of 3 0 percent debt and 7 0 percent common equity. Roberson is considering raising

11 - 4

Roberson Fashion's capital structure consists of

30

percent debt and

70

percent common equity.

Roberson is considering raising new capital to finance its expansion plans. The company's investment banker has compiled the following information about the cost of debt if the firm issues debt:

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