● 11. X Co. has NOI of `3,60,000 when its investment in assets is `20,00,000. It can raise debt at 12% rate of interest.

(i) Using the NI approach and an Equity Capitalisation rate of 18%, compute the total value of the firm and the weighted average Cost of Capital if the firm has

(a) no debt and

(b) `6,00,000 debt.

(ii) Using the NOI approach and an Equity Capitalisation rate of 15%, compute the total value of the firm value of shares and the cost of equity if the firm has

(a) no debt and

(b) `6,00,000 debt.

Assume taxes do not exist.