Look back at the Merck example in Section 18-1. Suppose Merck increases its long-term debt to $10
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Look back at the Merck example in Section 18-1. Suppose Merck increases its long-term debt to $10 billion. It uses the additional debt to repurchase shares. Reconstruct Table 18.3(b) with the new capital structure. How much additional value is added for Merck shareholders if the table’s assumptions are correct?
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Longterm debt increases by 10000 4943 5057 million The corporate tax rate is 35 so ...View the full answer
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Related Book For 
Principles of Corporate Finance
ISBN: 978-0077404895
10th Edition
Authors: Richard A. Brealey, Stewart C. Myers, Franklin Allen
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