TTC wants to gain a starting point as to where they are currently. As of today, the company has $$3\mathrm{.}2$ billion in debt, total equity capitalization of $$51$ billion, and an equity beta of $1\mathrm{.}26.$ Included in TT$\text{'}$s assets are $$14\mathrm{.}6$ billion in cash and risk free securities$.$ The company is currently is experiencing a risk free rate of interest at $4\%$ and a market risk premium of $5\%.$ Based on this information, address the questions below.

What is TT$\text{'}$s enterprise value?

What is the beta of TTC$\text{'}$s business assets?

What is the WACC of TTC$?$

$22$

$23$

$24$

$25$ TTC currently has common stock with a market value of $$8$ billion, along with their debt of $$3\mathrm{.}2$ billion. Investors are anticipating a $15\%$ return

$26$

on stock, and a $5\%$ return on debt. If TTC were to issue $$3\mathrm{.}2$ billion of new stock in order to pay off the debt, what would be the anticipated return of the stock after this transaction? What would happen to the return on stock if the company were instead to take out $$1$ billion in debt to repurchase shares? Assume both transaction would occur in a perfect market.

Anticipated stock return after stock issuance to pay off debt:

Anticipated return after increase of debt to repurchase shares:

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