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Suppose a large publicly traded firm seeks to raise capital. To raise capital, the firm had previously issued $10,000 10-year bonds with a coupon payment
Suppose a large publicly traded firm seeks to raise capital. To raise capital, the firm had previously issued $10,000 10-year bonds with a coupon payment of $100. Recent financial analysts have argued that the firm has made bad decisions under new management and is viewed as riskier. If the company now seeks to raise more funds through $10,000 10-year bonds, what do you think would happen to the coupon payment compared to before? What are two alternative methods of raising funds the firm could exercise
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