Computing required rate of return if debt-to-equity is given

Reference no: EM1340037

Q1) A firm is considering a project that will generate perpetual cash flows of $50,000 per year beginning next year. The project has the same risk as the firm's overall operations. If the firm's WACC is 12.0%, and its debt-to-equity ratio is 1.33, what is the most it could pay for the project and still earn its required rate of return?

Reference no: EM1340037

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