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Book Value Balance Net Working Capital $ 30Debt $80 Long Term Assets 70 Equity 20 100100 Market Value Balance Net Working Capital $ 30Debt $80

Book Value Balance

Net Working Capital $ 30Debt $80

Long Term Assets70Equity 20

100100

Market Value Balance

Net Working Capital $ 30Debt $80

Long Term Assets170 Equity 120

200200

$80 of debt and 32% corporate tax rate.

A grace period of 5 years. What will be the new value of the firm? Borrowing rate of 6.5%

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