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1. Consider the information given below. Equity = 600 r = 16% Debt = 400 r, = 6% Tax rate = 40% ROIC = 22%.

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1. Consider the information given below. Equity = 600 r = 16% Debt = 400 r, = 6% Tax rate = 40% ROIC = 22%. (a) Calculate the economic value added one year from today. (b) Assume that after year one the economic value added is a perpetuity. Calculate the value of the firm and the market value added. (c) Instead of the models in (a) and (b), suppose that beginning today the firm will grow by 6% forever (to infinity). Calculate the value of the firm and the market value added. 1. Consider the information given below. Equity = 600 r = 16% Debt = 400 r, = 6% Tax rate = 40% ROIC = 22%. (a) Calculate the economic value added one year from today. (b) Assume that after year one the economic value added is a perpetuity. Calculate the value of the firm and the market value added. (c) Instead of the models in (a) and (b), suppose that beginning today the firm will grow by 6% forever (to infinity). Calculate the value of the firm and the market value added

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