You are the CFO of a public company that advises distressed companies about how to manage their

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You are the CFO of a public company that advises distressed companies about how to manage their businesses in a recessionary environment. Your company has been performing extremely well since the recession began in 2008. During this period, your company has earned so much money that the increase in its retained earnings has resulted in a decline in the firm’s debt to total capital ratio from 30 percent to 15 percent. Much of the retained earnings is sitting in a cash account because your firm does not need the money fund investments. You would like to increase the debt-to-total capital ratio to 30 percent, which you view as optimal for your firm. How would you recommend doing this if you want to complete the adjustment as soon as possible?

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Fundamentals of corporate finance

ISBN: 978-0470876442

2nd Edition

Authors: Robert Parrino, David S. Kidwell, Thomas W. Bates

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