You need to choose between making a public offering and arranging a private placement. In each case the issue involves $10 million face value of 10-year debt. The following data is available for each: (ignore taxes) ¬ A public issue : The interest rate on the debt would be 8.5%, and the debt would be issued at face value. The underwriting spread would be 1.5%, and other expenses would be $80,000. ¬ A private placement : The interest rate on the private placement would be 9%, but the total issuing expenses would be only $30,000. 1. What is the difference in the proceeds to the company net of expenses?

rural residential development company and suburban real estate corporation form a joint stock company. the longest duration a joint stock company can be formed for is

Stock market crashes happen when the value of most of the stocks in the stock market increase at the same time. question 10 options: true false

Anew firm is developing its business plan. it will require $615,000 of assets, and it projects $450,000 of sales and $355,000 of operating costs for the first year. management is reasonably sure of these numbers because of contracts with its customers and suppliers. it can borrow at a rate of 7.5%, but the bank requires it to have a tie of at least 4.0, and if the tie falls below this level the bank will call in the loan and the firm will go bankrupt. what is the maximum debt ratio the firm can use? (hint: find the maximum dollars of interest, then the debt that produces that interest, and then the related debt ratio.)a. 41.94%b. 44.15%c. 46.47%d. 48.92%e. 51.49%