Question: Devon Corp. common shares sell at $40 per share and its earnings yield is 3.75%. If Devon borrows funds to repurchase shares at an after-tax

Devon Corp. common shares sell at $40 per share and its earnings yield is 3.75%. If Devon borrows funds to repurchase shares at an after-tax cost of debt of 5%, its EPS is most likely to:

Group of answer choices

A. increase.

B. decrease.

C. remain unchanged.

D. No answer text provided.

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