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answer for 9: b) answer for 10: a) Company B (bidder) is trying to determine the unique risk of a private company, Company T in
answer for 9: b)
Company B (bidder) is trying to determine the unique risk of a private company, Company T in order to determine the value of the potential offer. Given: AI,market=1.32 where AI stands for average industry T,AI=0.67 D/EAl=0.67 and T(tax rate for AI)=0.36 RMRF=5% RF=4% RD=5.5% a.) 0.47 b.) 0.93 c.) 1.40 d.) 0.78 e.) 1.88 Q.10) The change in WACC for Company T caused by the unique risk is: a.) 2.8% b.) 12.2% c.) 3.7% d.) 1.4% e.) 9.5% answer for 10: a)
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