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A farm is solely financed by equity with maket value of $50,000 and cost of equity of 10%, it wishes to raise another $30,000. via

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A farm is solely financed by equity with maket value of $50,000 and cost of equity of 10%, it wishes to raise another $30,000. via corporate bonds with cast af debt of 5% and une all of it to bory back outstanding equity (no cash holdintd. Hold investment policies fixed. In a MM world without taxes. 1. the firm value be ufter debt issuancis is \{ Hint: Firm Value - Equity Value + Debt Value - Cash 2. the cest of equity after debt is raised is 3. the Wace after debt is raised is

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