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McCann Catching, Inc. has 3.00 million shares of stock outstanding. The stock currently sells for $12.52 per share. The firm’s debt is publicly traded and was recently quoted at 92.00% of face value. It has a total face value of $10.00 million, and it is currently priced to yield 10.00%. The risk free rate is 2.00% and the market risk premium is 8.00%. You’ve estimated that the firm has a beta of 1.43. The corporate tax rate is 40.00%.

The firm is considering a $41.52 million expansion of their production facility. The project has the same risk as the firm overall and will earn $12.00 million per year for 6.00 years.

What is the percentage of equity used by McCann Catching, Inc.?

Financial Management, Finance

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