Question
In: Finance
Being Human, Inc., recently issued new securities to finance a new TV show. The project cost...
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Being Human, Inc., recently issued new securities to finance a new TV show. The project cost $35 million, and the company paid $2.2 million in flotation costs. In addition, the equity issued had a flotation cost of 7 percent of the amount raised, whereas the debt issued had a flotation cost of 3 percent of the amount raised. If the company issued new securities in the same proportion as its target capital structure, what is the company’s target debt-equity ratio? (Do not round intermediate calculations and round your answer to 4 decimal places, e.g., .1616.) |
Needs to be rounded to 4 decimal places.
Solutions
Expert Solution
Please refer to below spreadsheet for calculation and answer. Cell reference also provided.
Cell reference -
jeff jeffy answered 2 years agoRelated Solutions
Being Human, Inc., recently issued new securities to finance a new TV show. The project cost...
Being Human, Inc., recently issued new securities to finance a
new TV show. The project cost $35 million, and the company paid
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a flotation cost of 7 percent of the amount raised, whereas the
debt issued had a flotation cost of 3 percent of the amount raised.
If the company issued new securities in the same proportion as its
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