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Merriwether Building has FCF of $13 million, a tax rate of 40%, no debt, no short-term investments, and has a zero growth rate. The current

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Merriwether Building has FCF of $13 million, a tax rate of 40%, no debt, no short-term investments, and has a zero growth rate. The current stock price is $40 per share, and it has 2.5 million shares of stock outstanding. If it moves to a capital structure that has 40% debt and 60% equity (based on market values), its investment bankers believe its weighted average cost of capital would be 10%. What would its stock price be if it changes to the new capital structure? $60 $54 $48 $52 $40

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