Question: Need help with the following problem. Please show work. 8. (8 points) Need for External Financing To increase production capacity by 20%, a $3 million

Need help with the following problem. Please show work.

Need help with the following problem. Please show work. 8. (8 points)

8. (8 points) Need for External Financing To increase production capacity by 20%, a $3 million investment is needed. The firm wants to maintain a 40% debt-to-asset ratio, and continue to pay 75% of income as dividends. Net Income was $4 million A. How much External Financing is needed? B. How much new Debt must they Issue? C. How much new external equity should they issue

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