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    Breakpoint on the MCC where new stock will have to be issued

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    Your company is expected to earn $4.0 million in net income next year of which it will pay out 40% in dividends. If equity represents 50% of your capital, what is the breakpoint on the MCC where new stock will have to be issued?
    a. $2.4 million
    b. $3.2 million
    c. $4.0 million
    d. $4.8 million
    e. $8.0 million

    © BrainMass Inc. brainmass.com June 3, 2020, 7:54 pm ad1c9bdddf
    https://brainmass.com/business/finance/breakpoint-mcc-stock-issued-116205

    Solution Summary

    The solution calculates the breakpoint.

    $2.19

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