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Question
Welsh Corporation wants to issue debt of $525,000 to invest in a new project. Welsh is required to pay its investment banker 5 percent of the issue's total value. There are no other floatation costs. Compute the amount of debt that the firm must issue to net $525,000 after flotation costs.
a. $525,347
b. $552,632
c. $498,752
d. $551,257
e. $575,886
Answer
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