QUESTION 9

Bluegrass Mint Company has a debt-equity ratio of 0.3. The required return on the company's unlevered equity is 13.8% and the pretax cost of the firm's debt is 6.8%. Sales revenue for the company is expected to remain stable indefinitely at last year's level of $17,298,388.2. Variable costs amount to 57% of sales. The tax rate is 32% and the company distributes all its earnings as dividends at the end of each year. Use the WACC to compute the value of the company