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(zo- 12.5o) 33,333.33 4. AB C Inc. is looking at recapitalizing its current structure. The firm currently has no debt. It has an unlevered beta

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(zo- 12.5o) 33,333.33 4. AB C Inc. is looking at recapitalizing its current structure. The firm currently has no debt. It has an unlevered beta of 1. The current risk free rate is 5% with a market risk premium of 6%. The firm is expected to generate free cash flows of $35 million at an expected zero growth rate. The company has no short term investments, no preferred stock, and 10 million shares outstanding. If the firm decided to recapitalize with a new capital structure of 30% debt and 70% equity, the bank would provide the firm with a loan at 8%. If the company recapitalizes, it will use the proceeds from debt issuance to repurchase stock. The firm's tax rate is 40%. Based on this information, what is the firm's weighted Average Cost of Capital, Value of Operations, a (10 total points) nd price per share after the repurchase

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