Use the Information for the Question(s)below

question 22

Multiple Choice

Use the information for the question(s) below.
Shepard Industries expects free cash flow of $10 million each year.Shepard's corporate tax rate is 21%,and its unlevered cost of equity is 10%.The firm also has outstanding debt of $40 million and it expects to maintain amount of debt permanently.
-The value of Shepard Industries with leverage is closest to:

• A)$64 million.
• B)$100 million.
• C)$135 million.
• D)$108.4 million.

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