QUESTION 1

"Axon Industries needs to raise $1,000,000 USDs for a new investment project. If the firm issues 1-year debt, it may have to pay an interest rate of 9%, although Axon's managers believe that 5% would be a fair rate given the level of risk. If the firm issues equity, they believe the equity may be underpriced by 7%.What is the cost (in USDs) to current shareholders of financing the project out of retained earnings? Note: Express your answers in strictly numerical terms. For example, if the answer is $500, enter 500 as an answer."

QUESTION 2

"Axon Industries needs to raise $1,000,000 USDs for a new investment project. If the firm issues 1-year debt, it may have to pay an interest rate of 9%, although Axon's managers believe that 5% would be a fair rate given the level of risk. If the firm issues equity, they believe the equity may be underpriced by 7%.What is the cost (in USDs) to current shareholders of financing the project out of debt? Note: Express your answers in strictly numerical terms. For example, if the answer is $500, enter 500 as an answer."

QUESTION 3

"Axon Industries needs to raise $1,000,000 USDs for a new investment project. If the firm issues 1-year debt, it may have to pay an interest rate of 9%, although Axon's managers believe that 5% would be a fair rate given the level of risk. If the firm issues equity, they believe the equity may be underpriced by 7%.What is the cost (in USDs) to current shareholders of financing the project out of equity? Note: Express your answers in strictly numerical terms. For example, if the answer is $500, enter 500 as an answer."

Question 1 "Axon Industries needs to raise $1,000,000 USDs for a new investment project. If the firm issues 1-year debt, it may have to pay an interest rate of 9%, although Axon's managers believe that 5% would be a fair rate given the level of risk. If the firm issues equity, they believe the equity may be underpriced by 7%. What is the answer is $500, enter 500 as an answer." cost in USDs) to current shareholders of financing the project out of retained earnings? Note: Express your answers in strictly numerical terms. For example, if the Question 2 "Axon Industries needs to raise $1,000,000 USDs for a new investment project. If the firm issues 1-year debt, it may have to pay an interest rate of 9%, although Axon's managers believe that would be a fair rate given the level of risk. If the firm issues equity, they believe the equity may be underpriced by 7%. What is the cost in USDs) to current shareholders of financing the project out of debt? Note: Express your answers in strictly numerical terms. For example, if the answer is $500, enter 500 as an answer." Question 3 "Axon Industries needs to raise $1,000,000 USDs for a new investment project. If the firm issues 1-year debt, it may have to pay an interest rate of 9%, although Axon's managers believe that 5% would be a fair rate given the level of risk. If the firm issues equity, they believe the equity may be underpriced by 7%. What is the cost in USDs to current shareholders of financing the project out of equity? Note: Express your answers in strictly numerical terms. For example, if the answer is $500, enter 500 as an