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Assume the M&M assumptions hold (no taxes, no default, etc.). Firm U has a debt-equity ratio of zero and produces free cash flows equal to

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Assume the M\&M assumptions hold (no taxes, no default, etc.). Firm U has a debt-equity ratio of zero and produces free cash flows equal to $5,000 per year forever. The return on firm U 's assets equals 10% and the cost of debt is equal to 5%. An otherwise identical firm N has a debt-equity ratio of D/E=1. What is firm N 's firm value? $30.000 $40,000 $50,000 $60,000 None of the others

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