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What is the current market value of nodebt ltd

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Nodebt Ltd has a capital structure of 100% ordinary equity with a current return on equity of 18%: Its Earnings before Interest and Taxation was $142,857. Nodebt pays tax at the rate of 30%.

Question 1: What is the current market value of Nodebt Ltd?

Question 2: What is the Weighted Average Cost of Capital?

Question 3: What is the market value of Nodebt Ltd after it issues the debt?

Question 4: What is the market value of Nodebt Ltd's equity after it issues the debt?

Question 5: What is the cost of equity (ke) after it issues the debt?

Question 6: What is the new Weighted Average Cost of Capital?

Question 7: Explain what has happened to the WACC and why?

Reference no: EM132730576

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