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You are an investor in Borrow - Happy Ltd . , which has a debt - equity ratio of 3 : 1 . Though you

You are an investor in Borrow-Happy Ltd., which has a debt-equity ratio of 3:1. Though you have had a good experience thus far, you are influenced by an expert's advice published in media and decide to move your investment to a firm called Equity-Safe Inc. which is completely equity financed. You will do this by selling off your shares worth $35,000 and use the sales proceeds to partly finance your share purchase in the new firm. If you wish to retain the same earnings that you enjoyed with Borrow-Happy Ltd. how many dollars worth of shares you will need to buy in Equity-Safe Inc.? Provide supporting computations to your response.

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