Change Corporation expects an EBIT of $45,000 every year forever. The company currently has no debt,...

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Finance

Change Corporation expects an EBIT of $45,000 every yearforever. The company currently has no debt, and its cost of equityis 13 percent. The corporate tax rate is 23 percent.

a.
What is the current value of the company? (Do not roundintermediate calculations and round your answer to 2 decimalplaces, e.g., 32.16.)
b-1. Suppose the company can borrow at 9 percent. What will thevalue of the firm be if the company takes on debt equal to 40percent of its unlevered value? (Do not round intermediatecalculations and round your answer to 2 decimal places, e.g.,32.16.)
b-2. Suppose the company can borrow at 9 percent. What will thevalue of the firm be if the company takes on debt equal to 100percent of its unlevered value? (Do not round intermediatecalculations and round your answer to 2 decimal places, e.g.,32.16.)
c-1. What will the value of the firm be if the company takes on debtequal to 40 percent of its levered value? (Do not roundintermediate calculations and round your answer to 2 decimalplaces, e.g., 32.16.)
c-2.
What will the value of the firm be if the company takes on debtequal to 100 percent of its levered value? (Do not roundintermediate calculations and round your answer to 2 decimalplaces, e.g., 32.16.)
a. Current value $266,538.46
b-1. Value of the company
b-2. Value of the company
c-1. Value of the company
c-2. Value of the company

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Change Corporation expects an EBIT of $45,000 every yearforever. The company currently has no debt, and its cost of equityis 13 percent. The corporate tax rate is 23 percent. a.What is the current value of the company? (Do not roundintermediate calculations and round your answer to 2 decimalplaces, e.g., 32.16.)b-1.Suppose the company can borrow at 9 percent. What will thevalue of the firm be if the company takes on debt equal to 40percent of its unlevered value? (Do not round intermediatecalculations and round your answer to 2 decimal places, e.g.,32.16.)b-2.Suppose the company can borrow at 9 percent. What will thevalue of the firm be if the company takes on debt equal to 100percent of its unlevered value? (Do not round intermediatecalculations and round your answer to 2 decimal places, e.g.,32.16.)c-1.What will the value of the firm be if the company takes on debtequal to 40 percent of its levered value? (Do not roundintermediate calculations and round your answer to 2 decimalplaces, e.g., 32.16.)c-2.What will the value of the firm be if the company takes on debtequal to 100 percent of its levered value? (Do not roundintermediate calculations and round your answer to 2 decimalplaces, e.g., 32.16.)a.Current value$266,538.46b-1.Value of the companyb-2.Value of the companyc-1.Value of the companyc-2.Value of the company

a.	What is the current value of the company? (Do not roundintermediate calculations and round your answer to 2 decimalplaces, e.g., 32.16.)
b-1.	Suppose the company can borrow at 9 percent. What will thevalue of the firm be if the company takes on debt equal to 40percent of its unlevered value? (Do not round intermediatecalculations and round your answer to 2 decimal places, e.g.,32.16.)
b-2.	Suppose the company can borrow at 9 percent. What will thevalue of the firm be if the company takes on debt equal to 100percent of its unlevered value? (Do not round intermediatecalculations and round your answer to 2 decimal places, e.g.,32.16.)
c-1.	What will the value of the firm be if the company takes on debtequal to 40 percent of its levered value? (Do not roundintermediate calculations and round your answer to 2 decimalplaces, e.g., 32.16.)
c-2.	What will the value of the firm be if the company takes on debtequal to 100 percent of its levered value? (Do not roundintermediate calculations and round your answer to 2 decimalplaces, e.g., 32.16.)