Vapor Lock Motors EBIT is $7,000,000, the companys interest expense is $2,000,000, and its tax...
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Vapor Lock Motors EBIT is $7,000,000, the companys interest expense is $2,000,000, and its tax rate is 40 percent. Vapor Locks beta is 1.5.
a. What is Vapor Locks DFL?
b. If Vapor Lock were able to grow its EBIT by 50%, what would be the percentage increase in net income?
c. If Vapor Lock were able to grow its EBIT by 50%, what would be the resulting net income?
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