1 once bitten corp uses no debt the weighted average cost, Ask an Expert

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1. Once Bitten Corp. uses no debt. The weighted average cost of capital is 8.4 percent. If the current market value of the equity is $25 million and there are no taxes, what is EBIT? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars, e.g. 1,234,567.) EBIT $

2. Meyer & Co. expects its EBIT to be $52,000 every year forever. The firm can borrow at 9 percent. Meyer currently has no debt, and its cost of equity is 12 percent. If the tax rate is 35 percent, what is the value of the firm? (Do not round intermediate calculations. Round your answer to 2 decimal places, e.g., 32.16.) Value of the firm $

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Financial Management, Finance

Category:- Financial Management
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