Assume a Modigliani-Miller world. Antivaxer, PaleoBro and Boop are three similar companies in the wellness industry with the following capital structure and cash flows.

I need help with PART D

Assume a Modigliani-Miller (MM) world. AntiVaxer, PaleoBro, and Boop are three similar com- panies in the wellness industry with the following capital structures and cash flows: AntiVaxer PaleoBro Boop 10 6 20 $30 $35 $10.50 105 390 Shares outstanding (millions) Share prich Market value of perpetual debt (Smillion) Expected earnings before interest ($million) Interest expense (Smillion) Dividends (Smillion) 45 45 90 5.25 19.5 45 39.75 70.5 All three firms share identical business and operating risk characteristics, producing perfectly correlated earnings. Expected earnings will remain constant in perpetuity. All earnings are paid out as interest or dividends every year these payouts are also expected to remain constant. When answering the question, state any additional assumptions you may need to make. Show all working/calculations. Now assume companies must pay corporation tax at a rate of 30%. Interest is tax deductible, there are no personal taxes, and markets are semi-strong form efficient. All other MM assump tions still hold (d) Recompute the fair share price for each company. Remember, the cash flows in the table above are in an MM world (.e. no taxes) Assume AntiVaxer shares and all debt securities are priced at fair value in the MM world [3 marks