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L.A. Clothing has expected earnings before interest and taxes of $1,800, an unlevered cost of capital of 16 percent and a tax rate of 34
L.A. Clothing has expected earnings before interest and taxes of $1,800, an unlevered cost of capital of 16 percent and a tax rate of 34 percent. The company also has $2,500 of debt that carries an 8 percent coupon. The debt is selling at par value. What is the value of this firm?
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