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You own your own firm and you need to raise $50 million to fund an expansion.Following the expansion,your firm will be worth $75 million in its unlevered form.You want to go ahead with the expansion,but you are concerned that you may not be able to maintain ownership of over 50% of your firm's equity.In other words,you are concerned that if you use equity to finance the expansion,you may lose control of your firm.
-Assume that capital markets are perfect except for the existence of corporate taxes and that your firm pays 35% of earnings in taxes.If you want to maintain ownership of at least 50%,then calculate the minimum amount of debt that you must issue to fund the expansion.
Lake
Body of fresh water, often classified by nutrient status, such as oligotrophic (nutrient-poor) or eutrophic (nutrient-rich).
Stream
A small, natural body of flowing fresh water, leading from one to another or into a larger body of water.
Worldwide Distribution
The global spread or availability of a product, service, or phenomenon across the world.
Altitude
The height of an object or point in relation to sea level or ground level.
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