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Please help me solve this asap, thanks in advance! Restex has a debt-equity ratio of 0.89, an equity cost of capital of 15%, and a
Please help me solve this asap, thanks in advance!
Restex has a debt-equity ratio of 0.89, an equity cost of capital of 15%, and a debt cost of capital of 8%. Restex's corporate tax rate is 21%, and its market capitalization is $208 million. a. If Restex's free cash flow is expected to be $8 million one year from now and will grow at a constant rate, what expected future growth rate is consistent with Restex's current market value? b. Estimate the value of Restex's interest tax shieldStep by Step Solution
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