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What is the value of milton industries without leverage

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Reference no: EM132574517

Milton Industries expects free cash flows of $14 million each year. Milton's corporate tax rate is 21%, and its unlevered cost of capital is 15%. Milton also has outstanding debt of $23.44 million, and it expects to maintain this level of debt permanently.

Question a) What is the value of Milton Industries without leverage?

Question b) What is the value of Milton Industries with leverage?

Reference no: EM132574517

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