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Suppose a firm makes an EBIT of $50 million in perpetuity. This firm also has debt of $150 million at a cost of debt of

Suppose a firm makes an EBIT of $50 million in perpetuity. This firm also has debt of $150 million at a cost of debt of 9%. The firms unlevered cost of capital is 12% and its corporate tax rate is 40%.

What is the value of the firms equity?

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