A company s market value is 1 0 0 million euros, with 2 0 million in perpetual
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A companys market value is million euros, with million in perpetual debt and million in equity. This company decides to issue new perpetual debt with a market value of million euro, to repurchase equity. Both the old and new debt require a return of and offer a coupon rate of If the corporate tax rate is determine the new value of the equity.
Related Book For
Intermediate Algebra
ISBN: 9780134895987
13th Edition
Authors: Margaret Lial, John Hornsby, Terry McGinnis
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