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Suppose That a Company's Equity Is Currently Selling for $20

Question 94

Multiple Choice

Suppose that a company's equity is currently selling for $20 per share and that there are 2 million shares outstanding. If the firm also has 8 thousand bonds outstanding, which are selling at 99 percent of par ($1,000) , what are the firm's current capital structure weights for equity and debt respectively?


A) 50%, 50%
B) 16.81%, 83.19%
C) 83.47%, 16.53%
D) 83.33%, 16.67%

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