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ICI Company has unlevered beta of 1.4. Risk free rate in market is 12.5% and...

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ICI Company has unlevered beta of 1.4. Risk free rate in market is 12.5% and investor required 396 risk premium to invest in market. Tax rate of company is 40%. Following is the schedule of borrowing rate obtained from bank for different level of debt level in capital structure. Firm anticipating Rs. 150,000 operating profit (EBIT). Weight of debts Cost of debts (kd) 0 0.2 0.2 0.22 0.6 0.25 0.8 0.3 Use Hamada equation Note: No need to enter currency symbol and comma and 96 just type numbers 2 decimal number and percentages (if needed) according to excel (for example: 10000 or 10000.65 or 10.65%6) ARA 10000 or 10000.65 or 10.6596) Calculate Beta level at 20% debt weight Calculate Beta level at 40% debt weight Calculate Beta level at 60% debt weight Calculate Beta level at 80% debt weight Calculate cost od equity at 100% Equity weight Calculate cost od equity at 80% Equity weight Calculate cost od equity at 6096 Equity weight Calculate cost od equity at 80% Equity weight Calculate cost od equity at 60% Equity weight Calculate cost od equity at 40% Equity weight Calculate minimum wacc Calculate Maximum firm value

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