Business
Business, 11.12.2019 05:31, sydneyfarrimonp9k3j4

Calvert corporation expects an ebit of $22,300 every year forever. the company currently has no debt, and its cost of equity is 15 percent. the company can borrow at 10 percent and the corporate tax rate is 21 percent.
a. what is the current value of the company?
b. what will the value of the firm be if the company takes on debt equal to 50 percent of its unlevered value?
b. what will the value of the firm be if the company takes on debt equal to 100 percent of its unlevered value?

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Answers: 1

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Calvert corporation expects an ebit of $22,300 every year forever. the company currently has no debt...

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