Edwards Construction currently has debt outstanding with a market value of $98,000 and a cost of...

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Finance

Edwards Construction currently has debt outstanding with amarket value of $98,000 and a cost of 7 percent. The company hasEBIT of $6,860 that is expected to continue in perpetuity. Assumethere are no taxes.

a-1.

What is the value of the company's equity? (Do not roundintermediate calculations. Leave no cell blank - be certain toenter "0" wherever required.)

a-2.What is the debt-to-value ratio? (Do not roundintermediate calculations and round your answer to the nearestwhole number, e.g., 32.)
b.What are the equity value and debt-to-value ratio if thecompany's growth rate is 2 percent? (Do not roundintermediate calculations and round your "Debt-to-value" answer to3 decimal places, e.g., 32.161.)
c.What are the equity value and debt-to-value ratio if thecompany's growth rate is 6 percent? (Do not roundintermediate calculations and round your "Debt-to-value" answer to3 decimal places, e.g., 32.161.)

  
      

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Edwards Construction currently has debt outstanding with amarket value of $98,000 and a cost of 7 percent. The company hasEBIT of $6,860 that is expected to continue in perpetuity. Assumethere are no taxes.a-1.What is the value of the company's equity? (Do not roundintermediate calculations. Leave no cell blank - be certain toenter "0" wherever required.)a-2.What is the debt-to-value ratio? (Do not roundintermediate calculations and round your answer to the nearestwhole number, e.g., 32.)b.What are the equity value and debt-to-value ratio if thecompany's growth rate is 2 percent? (Do not roundintermediate calculations and round your "Debt-to-value" answer to3 decimal places, e.g., 32.161.)c.What are the equity value and debt-to-value ratio if thecompany's growth rate is 6 percent? (Do not roundintermediate calculations and round your "Debt-to-value" answer to3 decimal places, e.g., 32.161.)        

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