Question: Please help, i'm completly confused on both MM Model with Corporate Taxes Walkrun inc. is unlevered and has a value of $700 billion. An otherwise

Please help, i'm completly confused on both
Please help, i'm completly confused on both MM Model with Corporate Taxes
Walkrun inc. is unlevered and has a value of $700 billion. An

MM Model with Corporate Taxes Walkrun inc. is unlevered and has a value of $700 billion. An otherwise identical but levered firm finances 40% of its capital structure with debt at a 9% interest rate. No growth is expected. Assume the corporate tax rate is 25%. Use the MM model with corporate taxes to determine the value of the levered firm. Enter your answer in billions. For example, an answer of $1 billion should be entered as 1, not 1,000,000,000. Round your answer to the nearest whole number. $ bittion Premium for Financial Risk Ethier Enterprise has an unlevered beta of 1.50. Ethier is financed with 40% debt and has a levered beta of 2.25000 . If the risk free rate is 5.5% and the market risk premium is 4%, how much is the additional premium that Ethier's shareholders require to be compensated for financial risk? Round your answer to one decimal place. %

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