Question: answer it with explanation and working Now imagine that the company finds an opportunity to pursue a project with a levered NPV of 3 million

 answer it with explanation and working Now imagine that the company

answer it with explanation and working

Now imagine that the company finds an opportunity to pursue a project with a levered NPV of 3 million , requiring an initial investment of 5 million . If the company wants to fund this project such that right after the initial investment has been made its D/(D+E) ratio remains the same as before (found in alinea b): i. How much debt should the company issue to fund this project? ii. Draw the market value balance sheet right after the initial investment of 5 million has been made. If you were not able to answer b), please consider a target D/(D+E) of 0.30 for this exercise

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