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all 3 is 1 question Use the information for the following 3 questions: Lamey Co. has an unlevered cost of capital of 12.3 percent, a
all 3 is 1 question
Use the information for the following 3 questions: Lamey Co. has an unlevered cost of capital of 12.3 percent, a total tax rate of 25 percent, and expected earnings before interest and taxes of $32,840. The company has $60,000 in bonds outstanding that sell at par and have a coupon rate of 7.2 percent. 11. What is the unlevered value of the firm? A) 111,895 B) 155,244 C) 200,244 D) 215,244 E) 385,698 12. What is the levered value of the firm? A) 111,895 B) 155,244 C) 200,244 D) 215.244 E) 385,698 13. What is the cost of equity? A) 13.78 percent B) 13.36 percent C) 13.94 percent D) 14.07 percent E) 14.29 percent Step by Step Solution
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