Bruce amp co expects its ebit to be 89000 every year


Bruce & Co. expects its EBIT to be $89,000 every year forever. The company can borrow at 5 percent. The company currently has no debt, its cost of equity is 8 percent, and the tax rate is 35 percent. The company borrows $102,000 and uses the proceeds to repurchase shares.

What is the cost of equity after recapitalization?

What is the company's WACC?

Request for Solution File

Ask an Expert for Answer!!
Financial Management: Bruce amp co expects its ebit to be 89000 every year
Reference No:- TGS01414139

Expected delivery within 24 Hours