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30. Assume a zero percent discount rate for simplicity. Assume your current projects will return $560 tomorrow although your investors believe they will return only

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30. Assume a zero percent discount rate for simplicity. Assume your current projects will return $560 tomorrow although your investors believe they will return only $300. A new project will cost $600 and will return $800 tomorrow, but your investors believe it will return only $700. If you have no cash and can use only equity financing, what will the value of the combined firm be to the existing shareholders if the new project is undertaken? A) $1,000 B) $760 C) $544 D) None of the above answers is correct. 30. Assume a zero percent discount rate for simplicity. Assume your current projects will return $560 tomorrow although your investors believe they will return only $300. A new project will cost $600 and will return $800 tomorrow, but your investors believe it will return only $700. If you have no cash and can use only equity financing, what will the value of the combined firm be to the existing shareholders if the new project is undertaken? A) $1,000 B) $760 C) $544 D) None of the above answers is correct

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