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Problem 2 [14 Points] XYZ Inc., an unlevered firm, has expected earnings before interest and taxes of $3 million per year. XYZ tax rate is

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Problem 2 [14 Points] XYZ Inc., an unlevered firm, has expected earnings before interest and taxes of $3 million per year. XYZ tax rate is 40%. XYZ's stock has a beta of I. The risk-free rate is 9% and the market risk premium is 6%. a) [3 Points] Find the required return on equity and the value of XYZ Inc

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