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ABC is an unlevered firm with perpetual EBIT of $4,598. Its current cost of equity is 13.1%. ABC plans to borrow perpetual debt of $9,183

ABC is an unlevered firm with perpetual EBIT of $4,598. Its current cost of equity is 13.1%. ABC plans to borrow perpetual debt of $9,183 at interest rate of 5.9%. If the present value of the financial distress cost is 12.2% of the present value of tax shield and the tax rate is 35%, calculate the new equity value.

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