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Question 5 (1 point) A company just issued $374000 of perpetual 5% debt and used the proceeds to repurchase stock. The company expects to generate

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Question 5 (1 point) A company just issued $374000 of perpetual 5% debt and used the proceeds to repurchase stock. The company expects to generate 121000 of EBIT in perpetuity. The company distributes all its earnings as dividends at the end of each year. The firm's unlevered cost of capital is 14% and the tax rate is 15%. What is the required return on the firm's levered equity (report the cost of equity as a decimal number with four decimal places such as 0.1234)? Your Answer: Page 5 of 7 Next Page Answer Previous Page

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