6.Kline Construction is an all-equity firm that has projected perpetual earnings before interest and taxes of $628,000. The current cost of equity is 17.6 percent and the tax rate is 35percent. The company is in the process of issuing $430,000 of 8.3 percent annual coupon bonds at par and use the proceeds to repurchase the same amount of equity. What is the levered value of the firm?

a.

$3,541,085

b.

$3,824,318

c.

$2,713,185

d.

$2,469,818

e.

$3,385,695