Edwards Construction currently has debt outstanding with a market value of $103,000 and a cost of 12 percent. The company has EBIT of $12,360 that is expected to continue in perpetuity. Assume there are no taxes.

a-1. What is the value of the company's equity?

a-2. What is the debt-to-value ratio?

b. What are the equity value and debt-to-value ratio if the company's growth rate is 4 percent?

c. What are the equity value and debt-to-value ratio if the company's growth rate is 8 percent?