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Suppose that a firm firm currently has no debt but is planning on issuing $ 4 . 0 M in corporate bonds to finance a
Suppose that a firm firm currently has no debt but is planning on issuing $M in corporate bonds to finance a major expansion. The expected cost of debt is The firm currently has $ in equity. If the firm goes ahead with the planned debt issuance, what do you expect the firms cost of equity to be You can assume that the firm currenthly has a cost of capital of and a tax rate of
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