Wolfgang can borrow at 7.1 percent. The company currently has no debt, and the cost of equity

Question:

Wolfgang can borrow at 7.1 percent. The company currently has no debt, and the is 13.8 percent. The current value of the firm is $595,000. What will the value be if the company borrows $310,000 and uses the proceeds to repurchase shares? The corporate tax rate is 35 percent.
Cost Of Equity
The cost of equity is the return a company requires to decide if an investment meets capital return requirements. Firms often use it as a capital budgeting threshold for the required rate of return. A firm's cost of equity represents the...