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What happens to Rockboro's financing need and unused debt capacity if: a. No dividends are paid? b. A 20% payout is pursued? c. A 40%

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What happens to Rockboro's financing need and unused debt capacity if: a. No dividends are paid? b. A 20% payout is pursued? c. A 40% payout is pursued? d. A residual payout policy is pursued? Note that case Exhibit 8 presents an estimate of the amount of borrowing needed. Assume that maximum debt capacity is, as a matter of policy, 40% of the book value of equity

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