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What is expected of abc inc net profit and roe

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Suppose that ABC Inc. has ROA of 10% and pays an 8% coupon on its debt. ABC Inc. has a capital structure that is 70% equity and 30% debt. What is expected of ABC Inc.'s net profit and ROE, as compared to a firm that is 100% equity-financed? Back up your assertion.

Reference no: EM133071559

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