New Tab COD ate Center Question 7 1/ 1 pts A new firm is developing its business plan It will require $710,000 of assets (which equals total invested capital), and it projects $450,000 of sales and $355,000 of operating costs for the first year Management is reasonably sure of these mumbers because of contracts with its customers and suppliers. It can borrow at a rate of 7.5%, but the bank requires ut to have a TE of at least 40 and if the TE falls below this level the bank will call n the loan and the firm will go bankrupt. The firm will use only debt and common equity for financing What is the maximn debt to capital ratio (measured as debt total invested capital) the firm can use? (Hint Find the maxinmn dollars of interest, then the debt that produces that interest, and then the related debt to capital ratio.) Do not round your intermediate calculations 5480% 46.83% 44.60% 43.26% 38.80% 1/1pts Question 8