Question

In: Finance

What appears to be the targeted debt ratio of a firm that issues $15 million in equity and $35 million in bond to finance its new capital projects?


What appears to be the targeted debt ratio of a firm that issues $15 million in equity and $35 million in bond to finance its new capital projects?



30.00%



15.00%



70.00%



55.00%

Solutions

Expert Solution

Total assets=Total liabilities+Total equity

=(15+35) million

=$50 million

Debt ratio=Total debt/Total assets

=35/50

=70%

jeff jeffy answered 2 years ago
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