Solved: The tax rate is 35 and the current cost of equity is 152, Business Management

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The tax rate is 35 and the current cost of equity is 152

Jerricho snacks is an all equity firm with estimated earnings before interest and taxes of $624,000 annually forever. Currently, the firm has no debt but is considering borrowing $725,000 at 6.75% interest. The tax rate is 35% and the current cost of equity is 15.2%. What is the value of the levered firm?

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Business Management: The tax rate is 35 and the current cost of equity is 152

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