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Solve only one of F6 or F7; not both: F6 - ABC Ltd. has a capital of 10,000,000 in equity shares of 100 each. The

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Solve only one of F6 or F7; not both: F6 - ABC Ltd. has a capital of 10,000,000 in equity shares of 100 each. The shares are currently quoted at par. The company proposes to declare a dividend of 10 per share at the end of the current financial year. The capitalization rate for the risk class to which the company belongs is 12%. What will be the market price of the share at the end of the year, if (1) A dividend is not declared. (ii) A dividend is declared. (iii) Assuming that the company pays the dividend and has net profits of 5,000,000 and makes new investments of 10,000,000 during the period, how many new shares must be issued? Use the MM (Modigliani and Miller) Model

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