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Blaine Shoes, an unlevered firm, has a cost of capital of 15 percent and earnings before...

Blaine Shoes, an unlevered firm, has a cost of capital of 15 percent and earnings before interest and taxes of $500,000. Salem Shoes, A levered firm, has the same operations and assets has face value of debt of $7000,000 with a coupon rate of 7.5 percent that sells at par. The applicable tax rate is 35 percent. What is the value of the levered firm?

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