2 Download the annual income statements for another country. For the most recent year, calculate the average

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2 Download the annual income statements for another country. For the most recent year, calculate the average tax rate and EBIT, and find the total interest expense. From the annual balance sheets calculate the total long-term debt (including the portion due within one year). Using the interest expense and total long-term debt, calculate the average cost of debt. Next, find the estimated beta for your company using real historical data or a financial website, such as Yahoo! Finance. Use the company’s beta, an appropriate T-bill rate and the historical average market risk premium found in a previous chapter to calculate the levered cost of equity. Now calculate the unlevered cost of equity, then the unlevered EBIT. What is the unlevered value of your firm? What is the value of the interest tax shield and the value of the levered firm?

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