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 weak?
A) 8.0%
B) -37.5%
C) -58.6%
D) 10.28%
Correct Answer:
Verified
Correct Answer:
Verified
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