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Key Lime Pie Co. expects EBIT of $100,000 every year forever. Key Lime Pie Co. currently has no debt and its cost of equity is 10%. The firm can borrow at 6%. The corporate tax rate is 26%. What is the value of the firm? Enter your answer rounded to two decimal places. Number

Key Lime Pie Co. expects EBIT of $100,000 every year forever. Key Lime Pie Co. currently has no debt and its cost of equity is 10%. The firm can borrow at 6%. The corporate tax rate is 26%. What is the value of the firm? Enter your answer rounded to two decimal places. Number

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Key Lime Pie Co. expects EBIT of $100,000 every year forever. Key Lime Pie Co. currently has no debt and its cost of equity is 10%. The firm can borrow at 6%. The corporate tax rate is 26%. What is the value of the firm? Enter your answer rounded to two decimal places. Number
Transcribed Image Text:Key Lime Pie Co. expects EBIT of $100,000 every year forever. Key Lime Pie Co. currently has no debt and its cost of equity is 10%. The firm can borrow at 6%. The corporate tax rate is 26%. What is the value of the firm? Enter your answer rounded to two decimal places. Number
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