What is the cost of equity for the unleverd and levered firms? Given: Tax shield = 1,007.41 Size of debt = 40,000 Value of unlevered firm = 82,500 Value of levered firm = 96,100 Equity value of...

What is the cost of equity for the unleverd and levered firms?

Given:

Tax shield = 1,007.41

Size of debt = 40,000

Value of unlevered firm = 82,500

Value of levered firm = 96,100

Equity value of unlevered firm = 82,500

Equity value of levered firm = 56,100

Extracted text: А В C Unlevered Firm Levered Firm 10,000 3,200 6,800 2,312 4,488 3,200 1 2 EBIT 10,000 3 Interest 4 Taxable Income 10,000 3,400 6,600 5 Tax (tax rate: 34%) 6 Net Income 7 CFFA 0