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  1. business
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  3. the current value of a firm is $952,511 and it is

The current value of a firm is $952,511 and it is 100% equity financed. The...

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Accounting

  1. The current value of a firm is $952,511 and it is 100% equity financed. The firm is considering restructuring so that it is 31% debt financed. If the firm's corporate tax rate is 40%, what will be the new value of the firm under the MM theory with corporate taxes but no possibility of bankruptcy. Round to answer to two decimals.
  2. The current value of a firm is $474,519 and it is 100% equity financed. The firm is considering restructuring so that it is 22% debt financed. If the firm's corporate tax rate is 25%, the typical personal tax rate of an investor in the firm's stock is 15%, and the typical tax rate for an investor in the firm's debt is 25%, what will be the new value of the firm under the MM theory with corporate taxes but no possibility of bankruptcy. Round the answer to two decimals.

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