Bruce & Co

question 70

Multiple Choice

Bruce & Co.expects its EBIT to be $100,000 every year forever.The firm can borrow at 10 percent.Bruce currently has no debt,and its cost of equity is 20 percent.The tax rate is 34 percent.What will the value of Bruce & Co.be if the firm borrows $54,000 and uses the loan proceeds to repurchase shares?

• A)$280,130
• B)$346,600
• C)$348,360
• D)$378,900
• E)$381,520

---

Definitions:

Environmental Studies

An interdisciplinary academic field that focuses on understanding and solving environmental problems through the integration of physical, biological, and information sciences.

Portfolio Cover Letter

An introductory letter accompanying a portfolio, summarizing the contents and highlighting the relevance and strengths of the work presented.

Inventory of Skills

An assessment or list identifying an individual’s abilities, competencies, and qualifications, often used for career planning and development.

Major Change

Significant alteration or transformation in an organization, system, or personal life direction.