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please I need a complete answer with the steps This is all what I have for the question ) Company A has a market capitalization
please I need a complete answer with the steps
This is all what I have for the question
) Company A has a market capitalization of 5 million and debt of 1 million. It intends to maintain this debt to equity ratio. Free cash flows for the next year are 0.3 million. They are expected to grow 5% per year. The equity cost of capital is 0.12. The debt cost of capital is the risk free rate. The corporate tax rate is 0.23. Calculate the present value of the tax shield assuming it is risk free. ) Company A has a market capitalization of 5 million and debt of 1 million. It intends to maintain this debt to equity ratio. Free cash flows for the next year are 0.3 million. They are expected to grow 5% per year. The equity cost of capital is 0.12. The debt cost of capital is the risk free rate. The corporate tax rate is 0.23. Calculate the present value of the tax shield assuming it is risk free Step by Step Solution
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