Jericho Snacks Is an All-Equity Firm with Estimated Earnings Before

Jericho Snacks is an all-equity firm with estimated earnings before interest and taxes of $826,000 annually forever.Currently,the firm has no debt but is considering borrowing $650,000 at 6.75 percent interest.The tax rate is 34 percent and the current cost of equity is 17.2 percent.What is the value of the levered firm?

A) $3,187,271
B) $3,169,535
C) $3,307,271
D) $3,390,535
E) $3,506,418