I HAVE ALL ANSWERS EXCEPT THE DEBT TO EQUITY VALUE RATIO FOR B AND C. The answers to these are NOT B: 1.030 or C: 0.705

Edwards Construction currently has debt outstanding with a market value of $82,500 and a cost of 7 percent. The company has EBIT of $5,775 that is expected to continue in perpetuity. Assume there are no taxes.

a-1.	What is the value of the company's equity? (Do not round intermediate calculations. Leave no cell blank - be certain to enter "0" wherever required.)

Value of equity

0

a-2.	What is the debt-to-value ratio? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)

Debt-to-value ratio

1

b.	What are the equity value and debt-to-value ratio if the company's growth rate is 3 percent? (Do not round intermediate calculations and round your "Debt-to-value" answer to 3 decimal places, e.g., 32.161.)

Equity value	66206.25
Debt-to-value	??????

c.	What are the equity value and debt-to-value ratio if the company's growth rate is 5 percent? (Do not round intermediate calculations and round your "Debt-to-value" answer to 3 decimal places, e.g., 32.161.)

Equity value	220687.50
Debt-to-value	??????