Suppose Blank Company Has Only One Project,as Forecast Above,and an Unlevered

question 108

Multiple Choice

Suppose Blank Company has only one project,as forecast above,and an unlevered cost of equity of 8%.If the company borrows $10,000 at 5% to make the investment,what is the return to equity holders if demand is strong?

• A)8.0%
• B)54.0%
• C)28.6%
• D)38.0%
• E)42.3%

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