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A firm has a total market value of $100 millions. The market value of debt is $30 millions and that of equity is $70 millions.

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A firm has a total market value of $100 millions. The market value of debt is $30 millions and that of equity is $70 millions. The tax rate is 24%. Calculate the proportion of debt and equity used by the firm. 40% debt and 60% equity 30% debt and 70% equity 70% debt and 30% equity 19.8%% debt and 80.2% equity

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