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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,you issue $25 million in new debt,and you issue $25 million in new equity.You ownership stake in the firm following these new issues of debt and equity is closest to:
Independence Training
The process of teaching children or individuals to be self-sufficient and capable of making independent decisions and caring for themselves.
Basic Orientations
Fundamental viewpoints or predispositions individuals or societies hold toward life and the world, shaping behavior and perceptions.
Self-awareness
Being aware of one’s own self, including one's traits, feelings, reasons, and goals.
Sexual Identity
An individual's conception of themselves in relation to their sexual orientation, preferences, and behaviors, forming a critical aspect of personal identity.
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