Hot to Go Is an All-Equity Firm Specializing in Hot

Hot To Go is an all-equity firm specializing in hot ready-to-eat meals. Management has estimated the firm's earnings before interest and taxes will be $167,000 annually forever. The present cost of equity is 15.1 percent. Currently, the firm has no debt but is considering borrowing $750,000 at 9 percent interest. The tax rate is 34 percent. What is the value of the unlevered firm?

A) $623,017
B) $646,511
C) $704,141
D) $729,934
E) $755,200