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ed Assume Stratton Health Clubs, Inc., has $3 million in assets. If it goes with a low liquidity plan for the assets, it can earn a return of 20 percent, but with a high liquidity plan, the return will be 13 percent. If the firm goes with a short-term financing plan, the financing costs on the $3 million will be 10 percent; with a long term financing plan, the financing costs on the $3 million will be 12 percent. (Review Table 6-11 for parts a, b, and c of this problem.) a. Compute the anticipated return after financing costs on the most aggressive asset-financing mix. (Enter answers in whole dollar, not in million.) Anticipated return $ 1300,000| @ b. Compute the anticipated return after financing costs on the most conservative asset-financing mix. (Enter answers in whole dollar, not in million.) Anticipated return $ /30,000 & c. Compute the anticipated return after financing costs on the two moderate approaches to the asset-financing mix. (Enter answers in whole dollar, not in million.) Anticipated return Low liquidity $ (] High liquidity $ (/] d. This part of the question is not part of your Connect assignment.
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4
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