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Tempest Corporation expects an EBIT of $ 4 9 , 0 0 0 every year forever. The company currently has no debt, and its cost
Tempest Corporation expects an EBIT of $ every year forever. The company currently has no debt, and its cost of equity is percent. The tax rate is percent.
a
What is the current value of the company? Do not round intermediate calculations and round your answer to decimal places, eg
b Suppose the company can borrow at percent. What will the value of the firm be if the company takes on debt equal to percent of its unlevered value? Do not round intermediate calculations and round your answer to decimal places, eg
b Suppose the company can borrow at percent. What will the value of the firm be if the company takes on debt equal to percent of its unlevered value? Do not round intermediate calculations and round your answer to decimal places, eg
c What will the value of the firm be if the company takes on debt equal to percent of its levered value? Do not round intermediate calculations and round your answer to decimal places, eg
c What will the value of the firm be if the company takes on debt equal to percent of its levered value?
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