31 Fleecebook Inc. achieves a constant annual EBIT of $24.7 billion. The applicable tax rate is 35.0% and the beta of the (unlevered) business is 1.45. The firm has issued a total of 2,500 million shares. A) Given a risk-free rate of 4.80% and an expected market return of 13.80%, what is the unlevered cost of capital of the firm? % ut of juestion B) What is the fair value of a share assuming constant EBIT (and ignoring depreciation and capital expenses)? $ The company issues a 7.60% semi-annual coupon bond with a face value of $19.0 billion at par and uses the proceeds to expand the existing lines of business. Soon after issuance, the bond trades at a yield equal to the risk-free rate (time until maturity is 11 years). C) Compute the market value of the debt. $ billion D) The share price rises to $42.31. Compute the levered equity beta: E) Compute the cost of equity: % F) Compute the firm's WACC: % 31 Fleecebook Inc. achieves a constant annual EBIT of $24.7 billion. The applicable tax rate is 35.0% and the beta of the (unlevered) business is 1.45. The firm has issued a total of 2,500 million shares. A) Given a risk-free rate of 4.80% and an expected market return of 13.80%, what is the unlevered cost of capital of the firm? % ut of juestion B) What is the fair value of a share assuming constant EBIT (and ignoring depreciation and capital expenses)? $ The company issues a 7.60% semi-annual coupon bond with a face value of $19.0 billion at par and uses the proceeds to expand the existing lines of business. Soon after issuance, the bond trades at a yield equal to the risk-free rate (time until maturity is 11 years). C) Compute the market value of the debt. $ billion D) The share price rises to $42.31. Compute the levered equity beta: E) Compute the cost of equity: % F) Compute the firm's WACC: %