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Business, 26.08.2021 02:10 synite

A firm expects its EBIT to be $171,000 every year, in perpetuity. The company is currently unlevered with a cost of equity of 19%. It faces a tax rate of 23%. The firm plans to borrow $165,000 and use the proceeds to repurchase shares. If the firm's cost of borrowing is 12%, what is its WACC after the recapitalization

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A firm expects its EBIT to be $171,000 every year, in perpetuity. The company is currently unlevered...

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