Question
Company XYZ expects EBIT of $960 000 every year forever. The firm currently has no debt and its cost of equity is 16%. The firm
Company XYZ expects EBIT of $960 000 every year forever. The firm currently has no debt and its cost of equity is 16%. The firm can borrow $3 200 000 at 10% and buy back shares. The corporate tax rate is 35% and the media industry cost of equity is 12%. What would be the WACC after recapitalization?
Please show your work without using a financial calculator
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Finance And Control For Construction
Authors: Chris March
1st Edition
0415371155, 978-0415371155
