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Question 11 12 points) An all equity firm with a value of $2 million decides to issue $million of permanent debt priving 10% interest and
Question 11 12 points) An all equity firm with a value of $2 million decides to issue $million of permanent debt priving 10% interest and use the proceeds to buy back equity. If there are no costs to financial distress and the firm's tax rate in 30%, what will be the value of the Firm with the new capital structure? $1.30 million 52,00 million 52.03 million $2.10 million $2.30 million
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