The steps of the corporate valuation model

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1. Explain in your own words the steps of the corporate valuation model.

2. Show in a graph what happens to the WACC and the value of the overall company as we move from 0% debt to 100% debt. Show the point of the optimal capital structure.

3. Consider a $180,000, 5.50 percent, 15-year, interest-only mortgage with monthly interest payments. a) How large are each of the monthly payments? b) What will be the principal balance outstanding on this mortgage after four years?

Reference no: EM132053410

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