A company with no debt in its capital structure (an unlevered firm) has a stockholder required return of 13.6%. The company is expected to generate perpetual EBIT of $138,000. If the company adjusts its capital structure to contain $520,000, what is the (overall) value of this levered firm? Assume the tax rate is 34%, and the M&M theory of capital structure is valid.

$1,184,929.09

$1,191.505.88

$907,679.09

$996,421.19

$846,505.88