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ABC Co. is presently an all equity financed firm, with 8,000 shaes of common stock outstanding and a tax rate of 35%. Assume the Modigliani

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ABC Co. is presently an all equity financed firm, with 8,000 shaes of common stock outstanding and a tax rate of 35%. Assume the Modigliani tax case holds. The firm is evaluatin as follows: Miller and g two different financing plans, Common Stock Bond (Debt) 2,000 additional shares Ks = 10% EBIT-$ 50,000 $60,000 at 8% coupon rate K,-10.2727% EBIT-$ 50,000 As Ifcommon stock financing is employed, what is: The total stock value (S) 2 EPS 3 The market price per share (Po) 4. The value of the firm (V) 5. lts weighted marginal cost of capital (MCC) B. Rework A if bond financing is employed instead

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