In the following examples, please explain the relationships between a firm and it's market stages of growth, the kind of financing it should be seeking, the providers of such external finance at each stage of a market's development, the appropriate mix of debt to equity and how this can vary by industry.
A) The developer of a new mobile app needs $25 million in financing for advertising and software programming. What would be the proper debt to equity mix and where would it find this financing? What kind of dilution or floatation costs would be likely?
B) Merck wants to develop a promising new New Chemical Entity costing $800 million to $1 billion to bring through clinical trials to market. How would it expect to finance this project? What would the impact be on it's D/E?
C) WalMart has decided to expand its operations in Japan and now has a greater exposure to the Japanese Yen. How should it hedge its short term and long term foreign exchange exposures related to this expansion?