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to net working capital are anticipated. and WRT's debt is risk free with an interest rate of 5%. The corporate tax rate is 40%, and
to net working capital are anticipated. and WRT's debt is risk free with an interest rate of 5%. The corporate tax rate is 40%, and there are no personal taxes. be once the firm announces the expansion plan? Once the firm announces the expansion plan, the share price will be $ per share. (Round to the nearest cent.) If investors think that the EBIT from WRT's expansion will be only $4 million, the share price will be $ per share. (Round to the nearest cent.) The firm will need to issue million shares. (Round to two decimal places.) expansion. What will the share price be now? price will be $ (Round to the nearest cent.) Why does it differ from that found in part (a)? (Select the best choice below.) A. Shares in part (a) are not fairly valued and are fairly valued in part (b). B. Shares in part (a) are not fairly valued and are undervalued in part (b). C. Shares in part (a) are fairly valued and undervalued in part (b). D. Shares in part (a) are fairly valued and fairly valued in part (b)
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