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2. Assume the corporate tax rate is 30%. The firm has no debt in its capital structure. It is valued at $100 million. What would

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2. Assume the corporate tax rate is 30%. The firm has no debt in its capital structure. It is valued at $100 million. What would be the value of the firm if it issued $50mil in debt at a cost of 7% for 5 years and repurchased an equivalent amount of the equity? a. $65 000 000 b. $115 000 000 c. $100 000 000 d. $104 305 207 e. None of the above

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