Define the capital structure

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Question: Suppose a firm has a capital structure exclusively comprising of ordinary shares amounting to Rs. 1000000. The firm now wishes to raise additional Rs. 1000000 for expansion. The firm has 4 alternative financial plans:

i. Raise entire amount in the form of equity capital

ii. Raise 50% as equity capital and 50% debentures @ 5% interest.

Reference no: EM131456299

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