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Assume that a firm's optimal capital structure consists of 30% debt at a before tax cost of debt (Kp) of 8 percent, 10% preferred stock

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Assume that a firm's optimal capital structure consists of 30% debt at a before tax cost of debt (Kp) of 8 percent, 10% preferred stock at a cost of preferred (Kp) of 11 percent, and 60% stock at a cost of stock (Ks) of 15 percent, and that the firm's tax rate is 40%, giving the firm a WACC of Now assume that investors supplied $10.000.000 of capital (the initial cost of the firm) and the firm is expected to give them a constant free cash flow of $2,000,000 every year thereafter. Based on this information calculate the market value added for this form. $7,331,022.53 o $5,597,920.28 $8,197,573.66 $9,064,124.78 $6,464,471.40

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