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4. ABC is an all equity firm. its market value of equity is $10 million. ABC decides to issue $2 million debt and keeps the

4. ABC is an all equity firm. its market value of equity is $10 million. ABC decides to issue $2 million debt and keeps the same amount of debt in perpetiuts. assume a perfect market except for the tax of 30%

1. whats the market value of equity after the debt insurance.

2. explain the two facts that helped you calculate the market value of equity. why did you choose the formula you did

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