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BBC has perpetual EBIT of $4,559 and is an all equity financed firm. Its cost of equity is 12.4%. BBC plans to borrow perpetual debt
BBC has perpetual EBIT of $4,559 and is an all equity financed firm. Its cost of equity is 12.4%. BBC plans to borrow perpetual debt of $7,751 at an interest rate of 6.3% to repurchase stock. If the present value of financial distress costs is 11% of debt borrowed and the tax rate is 36%, calculate the new firm value. final ans upto 4 decimal places
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