1. Streiber Publishing is an all-equity firm that generates perpetual EBIT of $2.5M per year. Their after tax all equity discount rate is 20%. The corporate tax rate is 34%.a. What is the value of Streiber?b. If they do the debt for equity swap to include $600,000 worth of debt, what is the value of the firm?c. Explain the difference in your answers.

1. Streiber Publishing is an all-equity firm that generates perpetual EBIT of $2.5M per year. Their after tax all equity discount rate is 20%. The corporate tax rate is 34%.a. What is the value of Streiber?b. If they do the debt for equity swap to include $600,000 worth of debt, what is the value of the firm?c. Explain the difference in your answers.

1. Streiber Publishing is an all-equity firm that generates perpetual EBIT of $2.5M per year. Their after tax all equity discount rate is 20%. The corporate tax rate is 34%.a. What is the value of Streiber?b. If they do the debt for equity swap to include $600,000 worth of debt, what is the value of the firm?c. Explain the difference in your answers.