Dupuis can borrow at 1200 percent dupuis currently has no


Dupuis can borrow at 12.00 percent. Dupuis currently has no debt, and the cost of equity is 15 percent. The current value of the firm is $676,000. The corporate tax rate is 38 percent.

Required:

What will the value be if Dupuis borrows $227,000 and uses the proceeds to repurchase shares?

Value of the firm            $   

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Financial Management: Dupuis can borrow at 1200 percent dupuis currently has no
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