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Your startup LLC (which pays no income tax) has $500K available for a one-year marketing...

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Your startup LLC (which pays no income tax) has $500K available for a one-year marketing campaign of your Super Software product in Market X. You note that Market Y would also be a great place for a marketing campaign. The cost of a campaign in Y would be $300K. You present the firm's CFO with two options. Al Runa campaign in just Market X. B) Run a campaign in both X and Y, funding the campaign with a long term loan from Bank of China with a 10% annual interest rate. Here is more relevant financial information Notes for Plan B Loan amount for B) Debt intrate is 300 K 100% Projected Annual Income Statements for marketing campaigns (SK) Estimated Sales Generated from Campaign(s) Direct Campaign Cost Required Interest Cost @10% Campaign Net Income Plan A 750.00 500.00 0.00 250.00 Plan B 1200.00 -800 00 Campaign Profit Margin Use this info to answer the following questions. 20 Which Plan is Riskier and Why? Choose one plan and one reason Marketplace interest rates may move materially in a year It is more highly levered It is less levered 'It has a lower Z score There is less equity put into this project B

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