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Business, 27.08.2020 07:01 angelrenee2000

Suppose the PKK Corporation has decided in favour of capital restructuring that involves increasing ifs existing 60 million debt to $100 million. The interest rate on debt is 10 percent and expected to increase to 11 percent. The firm currently has 6 million shares outstanding, and the price per share is $20. If the restructuring is expected to increase the ROE, assume no tax, determine the minimum level for EBIT that PKK management must expecting. Ignoring taxes in your anwer.

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