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02-11-2022
Business

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Hubbard industries is an all-equity firm whose shares have an expected return of 10%. hubbard does a leveraged recapitalization, issuing debt and repurchasing stock, until its debt-equity ratio is 0.60. due to the increased risk, shareholders now expect a return of 13%. assuming there are no taxes and what is the interest rate on the debt? give your answer in percentage and with the % sign

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