business finance

A firm has 100,000 shares of stock outstanding. The firm is considering borrowing $1.2 million at 7.5% interest and using the loan proceeds to repurchase 20,000 shares of stock. What is the value of the firm? Ignore taxes. O $5.80 million O $6.00 million O $6.50 million O $6.80 millionA firm has a debt-equity ratio of 2.0. The required return on the firm's assets is 6.1% and the pre-tax cost of debt is 3.1%. Ignore taxes. What is the firm's cost of equity? O 12.1% O 15.1% O 23.1% O 18.5%