Determine the firms economic value added for year

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Assume that a firm's capital structure consists of $400,000 of debt at an after-tax cost of 6.0 percent, $300,00 of preferred at a cost of 9.0 percent, and $1,300,000 of stock at a cost of 18.0 percent. Also assume that the firm has earnings before interest and taxes (EBIT) of $785,000 and a tax rate of 40.0 perfect. Given this information determine the firms economic value added for the year

Reference no: EM133057081

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