Description of this paper

it's just one Question: "The MPD corporation mu...

Description

Solution


Question

it's just one Question: "The MPD corporation must raise $20 million to finance its current capital budget. A common stock issue could be made at a price of $ 10 per share, bonds could be issued with an interest rate of 8%. The firm currently has 3,000,000 shares outstanding and $ 10 million in ponds with an interest rate of 12%. There is no outstanding preferred stock. The firm's tax rate is 40%. What is the indifferent level of EBIT (EBIT*)? please can you try answer the problem with this formula: {EBIT-(curr interest + new interest)} ( 1-T )/ # of curr shares = = (EBIT - curr interest) ( 1- T )/ # of (curr shares + new shares),for the Question that you solve you used different formula than i told you, so please: could you told me how much are the: current interest, new interest, # of current shares, # of new shares. from the problem, so i can use our formula to solve the problem.

 

Paper#11882 | Written in 18-Jul-2015

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