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Consequences of increasing leverage

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Laura Appleton is the CFO of Travista Intl, a young financial software platform firm. Ms. Appleton is considering several projects in newly opening markets in Kazaksthan.. She believes that her firm should take advantage of the current low interest rates. Thus, she would like to increase the debt-equity ratio of the firm but is concerned about the consequences of increasing leverage. Knowing that you have recently taken a class in corporate finance, Ms. Appleton has come to you for advice. What would you tell her?

Reference no: EM132484380

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