Portfolio managementQ7 The EBIT of the unlevered company is OMR 80,000; value of unleveredcompany is OMR 480,000 and the corporate tax rate is 50%, then what isunlevered cost of equity under Modigliani-Miller Model?O a. 8.33%b. 25%C. 16.67%d. 33.33%

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unlevered cost of equity under Modigliani-Miller Model?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter17: Dynamic Capital Structures And Corporate Valuation

Section: Chapter Questions

Problem 2P

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Portfolio management

The EBIT of the unlevered company is OMR 80,000; value of unlevered
company is OMR 480,000 and the corporate tax rate is 50%, then what is
unlevered cost of equity under Modigliani-Miller Model?
O a. 8.33%
b. 25%
C. 16.67%
d. 33.33%

Definition Definition Act of managing the funds of another individual, company, or institution to maximize their wealth within a given time. Portfolio management helps to achieve financial objectives by reducing the risk of loss.

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