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Bruce & Co. expects its EBIT to be $191,000 every year, forever. The firm can borrow at 10 percent. Bruce currently has no debt, and
Bruce \& Co. expects its EBIT to be $191,000 every year, forever. The firm can borrow at 10 percent. Bruce currently has no debt, and its cost of equity is 16 percent. (Do not round intermediate calculations. Rounc the final answers to 2 decimal places. Omit $ sign in your response.) If the tax rate is 35 percent, what is the value of the firm? Value of the firm $ What will the value be if Bruce borrows $159,000 (perpetual debt) and uses the proceeds to repurchase shares? Value of the firm $
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