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An all-equity financed project will generate $20, $25, $30, $40, and $25 million dollars in the next five years. The project requires an initial investment
An all-equity financed project will generate $20, $25, $30, $40, and $25 million dollars in the next five years. The project requires an initial investment of $95 million. The unlevered cost of equity is 8%. The company can access a line of credit from a bank worth $60 million at a cost of 6%. If the companys marginal tax rate is 21%, what is the value of the projects equity?
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