My question is Q14- M&M and taxes , thank you very much!

vou illustrated e cost of capita ion and there are porate taxes quity ratio of 1.5. Its corporate tax rate is What if it were investing in ABC and using homemade leverage. c. What is the cost of equity for ABC? What is it for XYZ? d. What is the WACC for ABC? For XYZ? What principle have you in 10. M&M(LO1] Once Bitten Corp. uses no debt. The weighted average is 9.5 percent. If the current market value of the equity is $20.4 million no taxes, what is EBIT? 11. M&M and Taxes (LO2) In the previous question, suppose the corporate 35 percent. What is EBIT in this case? What is the WACC? Explain x 12. Calculating WACC (LO1) Twice Shy Industries has a debt equity rati WACC is 8.4 percent, and its cost of debt is 5.9 percent. The corporate 35 percent. a. What is the company's cost of equity capital? b. What is the company's unlevered cost of equity capital? e. What would the cost of equity be if the debt-equity ratio were 2? What if 1.0? What if it were zero? Calculating WACC [LO1] Braxton Corp. has no debt but can borrow at 6. cent. The firm's WACC is currently 10.2 percent, and the tax rate is 35 percent a. What is the company's cost of equity? b. If the firm converts to 25 percent debt, what will its cost of equity be? c. If the firm converts to 50 percent debt, what will its cost of equity be? d. What is the company's WACC in part (b)? In part (c)? 14. M&M and Taxes (LO2) Meyer & Co. expects its EBIT to be $83,000 every year forever. The firm can borrow at 8 percent. The company currently has no debt, and its cost of equity is 13 percent. If the tax rate is 35 percent, what is the value of the firm? What will the value be if the company borrows $125,000 and uses the proceeds to repurchase shares? 15. M&M and Taxes (LO2] In Problem 14, what is the cost of equity after recapital- ization? What is the WACC? What are the implications for the firm's capital structure decision? 16. M&M (LO2] Tool Manufacturing has an expected EBIT of $67,000 in perpetuity and a tax rate of 35 percent. The firm has $139,000 in outstanding debt at an interest rate of 6.85 percent, and its unlevered cost of capital is 10.25 percent. What is the value of the firm according to M&M Proposition I with taxes? Should the company change its debt-equity ratio if the goal is to maximize the value of the firm? Explain