Question 17 1 pts This information will be used for two questions! Sand Key Development Company has a capital structure consisting of $20 million of 10% debt and $30 million of common equity. The firm has 500,000 shares of common stock outstanding. Sand Key is planning a major expansion and will need to raise $15 million. The firm must decide whether to finance the expansion with debt or equity. If equity financing is selected, common stock will be sold at $75 per share. If debt financing is chosen, 6% coupon bonds will be sold. The firm's marginal tax rate is 34%. Determine the level of operating income at which Sand Key would be indifferent between debt financing and equity financing. $6,200,000 $4,625,000 $6,725,000 $5,675,000 $5,150,000 Question 18 1 pts This question is based on the other Sand Key Development Company question! Sand Key Development Company estimates that it will generate an operating income of $3.25 million. Which financing option should Sand Key use? The equity financing option. They should abandon plans for expansion. We don't have enough information to answer this. O Sand Key is indifferent between the two options. The debt financing option