A firm has an operating profit of $300.000 interest of %35,000 dividends of $6000. There are 400 outstanding common stocks and a tax rate of 40 percent. The firm has an after tax cost of debt of 5 percent and cost of equity of 15 percent. the firms target vapital structure is set are a mix of 40 percent debt an 60 percent equity.
Assuming this as the optimum capital structure calculate the value of the firm