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The Metallica Heavy Metal Mining (MHMM) Corporation wants to diversify its operations. Some recent financial...

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Accounting

The Metallica Heavy Metal Mining (MHMM) Corporation wants to diversify its operations. Some recent financial information for the company is shown here:
Stock price $ 50
Number of shares 30,000
Total assets $ 6,300,000
Total liabilities $ 3,300,000
Net income $ 390,000

MHMM is considering an investment that has the same PE ratio as the firm. The cost of the investment is $750,000, and it will be financed with a new equity issue.

The ROE on the investment would have to be percent
(Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) if we wanted the price after
the offering to be $50 per share (assume the PE ratio remains constant), and the NPV of the investment would be
(Leave no cells blank - be certain to enter "0" wherever required. Do not round intermediate calculations.) . Accounting dilution
occur in this case. Market value dilution occur in this case.

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