Thomas Corp. has an EBIT of $ 1 , 0 0 0 , 0 0 0 per

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Question:

Thomas Corp. has an EBIT of $

1, 000, 000

per year that is expected to continue in perpetuity. The unlevered cost of equity for the company is

13

percent, and the corporate tax rate is

22

percent. The company also has a perpetual bond issue outstanding with a market value of $

1.97

million. What is the value of the company?

(

Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to the nearest whole dollar, e

.

., 1, 234, 567 .)

Posted Date: May 18, 2024 08:02 PM

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Thomas Corp. has an EBIT of $ 1 , 0 0 0 , 0 0 0 per

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