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1. DLC Inc. is considering deleveraging its capital structure. Specifically, DLC plans to sell $10B in
new equity and use the proceeds to reduce debt. Its market/book ratio is 1. Explain the likely
effects on the following and WHY: (15 pts) a. ROA b. ROE c. ROIC d. EPS e. Operating cash
flows (EBIT + depreciation/amort) f. Share price

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