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Carlson Co, and Baker Corp. are identical in every respect except that Carison is unlevered and Baker has $6.9million of 5% bonds outstanding. Assume all

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Carlson Co, and Baker Corp. are identical in every respect except that Carison is unlevered and Baker has $6.9million of 5% bonds outstanding. Assume all of the following: 1. All of Modigiliani and Miller's assumptions are met. 2. Both firms are subject to a 40% corporate tax rate. 3. EBIT is $4.0 million for both firms. 4. Investors in both firms face a tax rate (Td) of 32% on debt income and a tox rate (TT3) of 12% on stock income. 5. The rate of return before personal taxes (r,v) is 14%. Use Miller's model to fill in the table for Carison Co, and Baker Corp

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