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Question #19: A firm produces perpetual free cash flows to the firm of $5 billion per year. Its WACC is 10%. The value of the

Question #19: A firm produces perpetual free cash flows to the firm of $5 billion per year. Its WACC is 10%. The value of the firm's debt is 10 billion. The firm is financed by only debt and equity. What is the firm's equity value?

A. $40 billion

B. $30 billion

C. $20 billion

Hint: Find EV and subtract debt

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