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Hunter Corporation expects an EBIT of $45,000 every year forever. The company currently has no debt and its cost of equity is 13 percent. The

Hunter Corporation expects an EBIT of $45,000 every year forever. The company currently has no debt and its cost of equity is 13 percent. The corporate tax rate is 23 percent.

A .Suppose the company can borrow at 9 percent. What will the value of the company be if takes on debt equal to 40 percent of its unlevered value?

B.Suppose the company can borrow at 9 percent. What will the value of the company be if takes on debt equal to 100 percent of its unlevered value?

C. What will the value of the company be if takes on debt equal to 40 percent of its levered value?

D. What will the value of the company be if takes on debt equal to 100 percent of its levered value?

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