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What would happen to return on equity

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Reference no: EM131810529

Problem

What would happen to return on equity and the net debt to equity ratio if a company raised an additional $50 million loan from the bank, which it invested entirely in a new plant and equipment. assume that the immediate effect on sales and net profit was zero.

What would happen if it was raised an additional 50 million through sales of new shares to the public instead of a loan.

Reference no: EM131810529

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