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The stock of an all-equity company currently sells for $45 per share. You own 130 shares of this company's stock and have a cost of
The stock of an all-equity company currently sells for $45 per share. You own 130 shares of this company's stock and have a cost of borrowing of 7%. If you want to use homemade leverage to create a D/E ratio of 1.25, what amount should you borrow or lend to make this happen?
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