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What is the value of the company according to m-m

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Reference no: EM132819644

Problem 1: In all-equity company with a cost of capital of 9% expects its EBIT will be $270,000 every year forever. Assume all available earnings are immediately distributed to common shareholders and all the M&M assumptions are satisfied except the company's corporate tax rate is 20%. What is the value of the company according to M&M Proposition I with taxes?

Reference no: EM132819644

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