Suncoast Boats Limited is an all equity firm that has a perpetual EBIT of $1,500,000. You have been provided the following information from the market: Goverment t-bill rate = 2.5% The market risk premium = 7.5% The un-levered Beta = 1 There are no taxes and no cost for the risk of default on any debt that is issued. Proposition I, the value of the firm is $1,500,000 $60,000,000 $20,000,000 $15,000,000

Suncoast Boats Limited is an all equity firm that has a perpetual EBIT of $1,500,000. You have been provided the following information from the market: Goverment t-bill rate =2.5% The market risk premium =7.5% The un-levered Beta =1 There are no taxes and no cost for the risk of default on any debt that is issued. Proposition I, the value of the firm is $1,500,000 $60,000,000 $20,000,000 $15,000,000