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What is the value of the firm

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Question - Haji Real Estate expects an EBIT of Br. 10,000 every year forever. Haji Real Estate can borrow at 7%. Suppose Haji Real Estate currently has no debt and its cost of equity is 17%. If the corporate tax rate is 35%, what is the value of the firm? What will the value be if Haji Real Estate borrows Br. 15,000 and uses the proceeds to repurchase stock?

A. Br. 45,485.29

B. Br. 43,485.29

C. Br. 47,485.29

D. Br. 53,485.29

Reference no: EM132613196

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