Tech Corp had gross sales of $9 million and total ex- penses of $8.5 million. Assume that Tech wants to undertake a capital investment of $1 million. What is the minimum amount of bonds it would have to issue to do so? Assume that Tech pays out $300,000 in dividends. Now what is the minimum amount it would have to borrow?
Tech Corp had gross sales of $9 million and total ex- penses of $8.5 million. Assume that Tech wants to undertake a capital investment of $1 million. What is the minimum amount of bonds it would have to issue to do so? Assume that Tech pays out $300,000 in dividends. Now what is the minimum amount it would have to borrow?
Chapter15: Dividend Policy
Section: Chapter Questions
Problem 4P
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