Assume a Modigliani miller no tax world. An all equity firm has an unleveraged cost...
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Assume a Modigliani miller no tax world. An all equity firm has an unleveraged cost of equity of * % and expected EBT each year of $ 460000. The firm has decided to issue $2500000 of debt (ignore issuing Cost) at an interest rate of 5% in order to finance a project (of similar risk to the firms current operations which is expected to generate an annual return of 14% for many years to come. The firm has 100,000 shares outstanding. Find the eps of the firm without or with the project
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