Aiter a sucerstu college football careet, Tim Turbo partnered with Danny Waffle (naming (i) on 1//2022, the company had one product that generated EBIT of $200,000 on 12/31 of each Far foreets with an asset beta of 1.25. The firm faced a tax rate of 40 percent, and the firm had no deth outbanding At thir time, the risk-fice rate, Re, was 3 percent and the MRP was 5 percent. The firm had 100,000 sturs outsanding, and all eamings were (and will always be) paid out as dividends. As you can calubte, the firm had a price / share of $12.97. On122022 at 800 an, TD announced a new pie product: - The proect required that the company spend $750,000 to purchase The Buckeye Grinder 2500,a budese mashing machine. For tax purposes, the machine will not be depreciated since it will last forter. No worning capital is required. - To find the project, \$X will be raised as perpetual debt, with an annual coupon rate equal to the (iskiter ale and interest paid annually. The balance of the funds needed will be raised as new Ac tur time, the riskfiree rate, Rf, was 3 percent and the MRP was 5 percent. The firm had 100,000 firms outsanding, and all eamings were (and will always be) paid out as dividends. As you can alculat, the firm had a price/ share of $12.97. On 1/2/2022 at 800 am. TD announced a new pie product: - The probect required that the company spend $750,000 to purchase The Buckeye Grinder 2500,a buckeve mashing machine. For tax purposes, the machine will not be depreciated since it will last torever. No working capital is required. - To tund the project, $X will be raised as perpetual debt, with an annual coupon rate equal to the riswiree nate, and interest paid annually. The balance of the funds needed will be raised as new The project increased the company's EBIT by $466,666.66 a year forever/starting on 12/31/2022. Deproject had an asset beta of 1.7 As you can calculate, when the market opened at 9:30 a.m., the price / share fully adjusted to the amouncement, selling for $31.4208. The company then issued the new shares and debt, and Aiter a sucerstu college football careet, Tim Turbo partnered with Danny Waffle (naming (i) on 1//2022, the company had one product that generated EBIT of $200,000 on 12/31 of each Far foreets with an asset beta of 1.25. The firm faced a tax rate of 40 percent, and the firm had no deth outbanding At thir time, the risk-fice rate, Re, was 3 percent and the MRP was 5 percent. The firm had 100,000 sturs outsanding, and all eamings were (and will always be) paid out as dividends. As you can calubte, the firm had a price / share of $12.97. On122022 at 800 an, TD announced a new pie product: - The proect required that the company spend $750,000 to purchase The Buckeye Grinder 2500,a budese mashing machine. For tax purposes, the machine will not be depreciated since it will last forter. No worning capital is required. - To find the project, \$X will be raised as perpetual debt, with an annual coupon rate equal to the (iskiter ale and interest paid annually. The balance of the funds needed will be raised as new Ac tur time, the riskfiree rate, Rf, was 3 percent and the MRP was 5 percent. The firm had 100,000 firms outsanding, and all eamings were (and will always be) paid out as dividends. As you can alculat, the firm had a price/ share of $12.97. On 1/2/2022 at 800 am. TD announced a new pie product: - The probect required that the company spend $750,000 to purchase The Buckeye Grinder 2500,a buckeve mashing machine. For tax purposes, the machine will not be depreciated since it will last torever. No working capital is required. - To tund the project, $X will be raised as perpetual debt, with an annual coupon rate equal to the riswiree nate, and interest paid annually. The balance of the funds needed will be raised as new The project increased the company's EBIT by $466,666.66 a year forever/starting on 12/31/2022. Deproject had an asset beta of 1.7 As you can calculate, when the market opened at 9:30 a.m., the price / share fully adjusted to the amouncement, selling for $31.4208. The company then issued the new shares and debt, and
