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Use the Information for the Question(s)below

question 49

Multiple Choice

Use the information for the question(s) below.
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,you issue $30 million in new debt,and you issue $20 million in new equity.You ownership stake in the firm following these new issues of debt and equity is closest to:

Definitions:

Significant Demographic

A notable segment of the population identified by specific characteristics such as age, gender, income, or ethnicity, which is particularly important for targeted marketing or policy-making.

UN Guiding Principles

A global standard for preventing and addressing the risk of adverse impacts on human rights linked to business activity, providing a framework for governments and companies.

Human Rights

Human Rights refer to the fundamental rights and freedoms that all individuals are entitled to, regardless of nationality, sex, national or ethnic origin, race, religion, language, or any other status.

Sustainability

The practice of maintaining and improving the quality of human life while living within the carrying capacity of supporting ecosystems.