How much would the firm have to sell

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Question 1: Suppose that Lil John Industries equity is currently selling for $44 per share and that 3.7 million shares are outstanding. The firm also has 67,000 bonds outstanding, which are selling at 104 percent of par. Assume Lil John was considering an active change to its capital structure so that the firm would have a (D/E) of 1.3. The firm will sell bonds and buy back stocks. How much would the firm have to sell?

Reference no: EM132552156

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