Question: M&M and Taxes [ LO 2 ] In Problem 1 4 , what is the cost of equity after recapitalization? What is the WACC? What

M&M and Taxes [ LO2] In Problem 14, what is the cost of equity after recapitalization? What is the WACC? What are the
implications for the firm's capital structure decision?M&M and Taxes [[ LO2] Fields & Co. expects its EBIT to be $125,000 every year forever. The firm can borrow at 7 percent. The
company currently has no debt, and its cost of equity is 12 percent. If the tax rate is 24 percent, what is the value of the firm? What will
the value be if the company borrows $205,000 and uses the proceeds to repurchase shares?
M&M and Taxes [ LO2] In Problem 14, what is the

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