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Destion 14 ot yet nswered Marked out of 200 Consider a project with free cash flows in one year of $90 000 in a weak
Destion 14 ot yet nswered Marked out of 200 Consider a project with free cash flows in one year of $90 000 in a weak economy or $117 000 in a strong economy, with each outcome being equally likely. The initial investment required for the project is $40 000, and the project's cost of capital is 14.7%. The risk-free interest rate is 5%. Suppose that to raise the funds for the initial investment the firm borrows $20 000 at the risk-free rate and issues new equity to cover the remainder. In this situation, the value of the firm's levered equity from the project is closest to Flag question Select one: a. $50235 b. $70235 c. $83500 d. $90235 can million i million of which are
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