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Can you solve for the following? Thanks Ch Meyer & Co. expects its EBIT to be $87000 every year forever. The firm can borrow at
Can you solve for the following? Thanks
Ch Meyer & Co. expects its EBIT to be $87000 every year forever. The firm can borrow at 6 rcent. The company currently has no debt, and its cost of equity is f1 percent and the tax rate is 21 percent. The company borrows $147000 and uses the proceeds to repurchase shares. a. What is the cost of equity after recapitalization? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, eg 32.16.) b. What is the WACC? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. a. Cost of equity b. WACC Step by Step Solution
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