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1 6 . 8 M&M Proposition 2 : Mikos Processed Foods is currently valued at million. Mikos will be repurchasing mil - lion of its
M&M Proposition : Mikos Processed Foods is currently
valued at million. Mikos will be repurchasing mil
lion of its equity by issuing a perpetual debt issue at a per
cent annual interest rate. Mikos is subject to a per cent mar
ginal tax rate. Given all of the Modigliani and Miller assump
tions, except the assumption that there are no taxes, what will
be the value of Mikos after the recapitalisation?
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