Question: You are considering a project which requires $250,000 in external financing. The flotation cost of equity is 7% and the flotation cost of debt is

You are considering a project which requires $250,000 in external financing. The flotation cost of equity is 7% and the flotation cost of debt is 2.5%. You wish to maintain a debt-equity ratio of 0.55. What is the initial cost of the project including the flotation costs?

$235,720

$263,508

$264,280

$254,752

$255,784

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