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NEED HELP ASAP Firm A is considering acquiring Firm B. The acquisition is expected to create...

NEED HELP ASAP

Firm A is considering acquiring Firm B. The acquisition is expected to create value because of projected cost reductions due to economies of scale in the operations of both firms. The total annual cost savings before tax are expected to be $300, starting in Year 1. The cost savings are perpetual. The appropriate WACC is 10% and the tax rate is 40%. What is the total value created by the acquisition, available to be shared by firms A and B?

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Answer #1

- According to the given suim, guformation available - Cost = $ 300 WACC = 10%. Tax Rate = 40% s out 10 X 160 WACC = D x Voxcall options -food price BUT eme So, from the above formule calculation. 100 - $ *3006[-40] => Assume v=d then 100 D x 300 x

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