Question
Assumption: WD = 60%, RD = 14%, for unleveraged firm: Bu =1; Tax Rate=35%, Rf= 5%,...
Assumption: WD = 60%, RD = 14%, for unleveraged firm: Bu =1; Tax Rate=35%, Rf= 5%, Market Return Premium = 6%, FCF0 = 250 million, g=3%. Use the formula B = Bu [1+ (1-T) × (Wd /Ws)], What is the WACC and what is the value of the firm?
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