Answered You can hire a professional tutor to get the answer.

QUESTION

Flotation Costs:Media Corp. has debt-equity ratio of .The company is considering a new plant that will cost $125 million to build.

Flotation Costs: Media Corp. has debt-equity ratio of .75. The company is considering a new plant that will cost $125 million to build. When the company issues new equity, it incurs a flotation cost of 10%. The flotation cost on new debt is 4%. What is the initial cost of the plant if the company raises all equity externally?

I come up with initial cost of $134.28 million.

Is this correct?

Show more
LEARN MORE EFFECTIVELY AND GET BETTER GRADES!
Ask a Question