Question: What will the value be if the company borrows $125,000 and uses the proceeds to repurchase shares? O $331,505.53 O $471,666.67 O $581,061.37 O $681.061.37
What will the value be if the company borrows $125,000 and uses the proceeds to repurchase shares? O $331,505.53 O $471,666.67 O $581,061.37 O $681.061.37 (Use the following information for problems 22 - 26) The XYZ Company (XYZ) currently has $200,000 market value (and book value) perpetual debt outstanding carrying a coupon rate of 6 percent. Its earnings befo interest and taxes (EBIT) are $100,000, and it is a zero - growth company with 10 payout ratio. XYZ's current cost of equity is 8.8 percent, and its tax rate is 40 perc The firm has 10,000 shares of common stock outstanding selling at a price per sha $60.00. What is XYZ's current total market value and weighted average cost of car $600.000; 7.5% $600,000: 8.0% O $800,000: 7.096 $800,000: 7.5% $800.000: 8.0%
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