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The flotation cost on new debt is 4 what is the initial

Flotation Costs

Medina Corp. has a debt-equity ratio of .75. The company is considering a new plant that will cost $125 million to build. When the company issues new equity, it incurs a flotation cost of 10%. The flotation cost on new debt is 4%. What is the initial cost of the plant if the company raises all equity externally?

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Basic Statistics: The flotation cost on new debt is 4 what is the initial

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Basic Statistics: The flotation cost on new debt is 4 what is the initial

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