Question: Coupon rate on bonds = 8% Long-term debt = $1 million Number of shares = 100,000 Income tax rate = 30% EBIT = $200,000 Price

Coupon rate on bonds = 8% Long-term debt = $1 million Number of shares = 100,000 Income tax rate = 30% EBIT = $200,000 Price per share = $4.20 Coupon rate on bonds = 8% Long-term debt = $1 million Number of shares = 100,000 Income tax rate = 30% EBIT = $200,000 Price per share = $4.20

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