Overall capital structure recommendation

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Now, please turn your above analysis into an overall capital structure recommendation. Hint: To do this, you might want to use your projected credit ratings to estimate expected costs of ?nancial distress (i.e., bankruptcy costs). Note that it is ?ne to examine just the 0%, 40%, and 80% debt cases, though you can consider other capital structures if you would like. For simplicity, assume that if a ?rm defaults, 15% of ?rm value is lost due to bankruptcy and related costs.

Reference no: EM133056975

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