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JD Corp is considering a leverage recap to capture some tax benefit. Assume that the firm value before leverage recap is $4 billion. If JD
JD Corp is considering a leverage recap to capture some tax benefit. Assume that the firm value before leverage recap is $4 billion. If JD Corp issue $1 billion debt and pay out all the procced from debt issuance to its shareholders, what is the firm value after the leverage recap? (ignore cost of bankruptcy. The corporate tax rate is 20.4%. Please answer without the "$" sign, the unit should be MILLION. For example, if your answer is $10.00 million, just fill in 10.00. Please keep two decimal places.)
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