The TRIM Corporation Has Decided to Build a New Facility

question 20

Multiple Choice

The TRIM Corporation has decided to build a new facility for its R&D department. The cost of the facility is estimated to be $150 million. TRIM wishes to finance this project using its traditional debt-equity ratio of 1.2. The issue cost of equity is 7% and the issue cost of debt is 2%. What is the total flotation cost?

• A) $3.00 million
• B) $5.59 million
• C) $6.75 million
• D) $6.41 million
• E) $10.5 million

---

Definitions:

Brain Areas

Specific regions within the brain responsible for different functions, such as emotion, decision-making, memory, and language processing.

Forebrain

The anterior part of the brain, including the cerebrum and diencephalon, involved in complex behavioral, sensory, and cognitive processes.

Cerebral Cortex

The Cerebral Cortex is the outermost layer of the brain, involved in high-level functions such as thought, language, memory, and consciousness.

Cerebellum

A part of the brain located at the back of the skull, primarily responsible for coordinating and regulating muscular activity.