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Consider two firms, With and Without, that have identical assets that generate identical cash flows.Without is an all-equity firm, with 1 million shares outstanding that

Consider two firms, With and Without, that have identical assets that generate identical cash flows.Without is an all-equity firm, with 1 million shares outstanding that trade for a price of $24 per share.With has 2 million shares outstanding and $12 million dollars in debt at an interest rate of 5%.

In a world without tax nor other frictions, according to MM Proposition 1, the stock price for With is closest to:

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