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The Smith Vacations Company has expected earnings before interest and taxes of $2,100 per year in perpetuity, an unlevered cost of capital of 14% and a tax rate of 34%. The company also has $2,800 of debt that carries a 7% coupon. The debt is selling at par value. What is the value of this firm?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92420040

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