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Business, 06.12.2019 04:31 caitlyn79

Afirm currently has the following capital structure which it intends to maintain. debt: $3,000,000 par value of 9% bonds outstanding with an annual before‐tax yield to maturity of 7.67% on a new issue. the bonds currently sell for $115 per $100 par value. common stock: 46,000 shares outstanding currently selling for $50 per share. the firm expects to pay a $5.50 dividend per share one year from now and is experiencing a 3.67% growth rate in dividends, which it expects to continue indefinitely. the firmʹs marginal tax rate is 40%. the company has no plans to issue new securities.
1- the current total value of the firm is: a) $6,450,000.b) $5,750,000.c) $4,950,000.d) $3,250,000.

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Afirm currently has the following capital structure which it intends to maintain. debt: $3,000,000...
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