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Trower Corp. has a debt - to - equity ratio of 0 . 7 0 . The company is considering a new plant that will
Trower Corp. has a debttoequity ratio of The company is considering a new plant that will cost $ million to build. When the
company issues new equity, it incurs a flotation cost of percent. The flotation cost on new debt is percent. Do not round
intermediate calculations. Round the final answer to the nearest whole dollar amount. Enter your answer in thousands of dollars.
Omit $ sign in your response.
What is the initial cost of the plant if the company raises all equity externally?
Initial cash flow
What is the initial cost of the plant if the company typically uses percent retained earnings?
Initial cash flow
What is the initial cost of the plant if the equity investments are financed through retained earnings?
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