You work for a constant-growth firm that is valued at $500 million. It has a...
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You work for a constant-growth firm that is valued at $500 million. It has a capital structure of 25% debt and 75% equity, and there are no short-term investments. Your firm's current tax rate is 25%, but Congress is expected to pass legislation that will increase it to 35%. If the firm's capital structure and costs of capital remain constant, what will happen to the firm's WACC? You work for a constant-growth firm that is valued at $500 million. It has a capital structure of 25% debt and 75% equity, and there are no short-term investments. Your firm's current tax rate is 25%, but Congress is expected to pass legislation that will increase it to 35%. If the firm's capital structure and costs of capital remain constant, what will happen to the firm's WACC
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