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involved in it? What factors other than risk do you think the directors

should keep in view before taking the decisions?
2. New Delhi has been declared as the most polluted city in the world.

Bangalore, Mumbai, Patna, Ahmadabad, Lucknow, Kanpur and Ludhiana
are also the highly polluted Indian cities. This has resulted into a dramatic

increase in the sale of home air purifiers. The prices of these devices range
from 2,000 to 25,000 depending upon the type of pollutant these purifiers
remove. Looking at the increasing demand of these air purifiers 'Pure Air

Technology India Ltd. has developed a low cost home air purifier in its R

and D Lab. The company has estimated that a commercial production of
1, 00,000 units per year may cost the company 500 per unit. For, this
capital of 100, 15 cores will be required. The company decided to have both

equity and debt in its capital structure. Explain any four factors that the
company should consider while deciding its capital structure.