Question: Foundation, Incorporated, is comparing two different capital structures: an all - equity plan ( Plan I ) and a levered plan ( Plan II )

Foundation, Incorporated, is comparing two different capital structures: an all-equity plan (Plan I) and a levered plan (Plan II). Under Plan I, the company would have 170,000 shares of stock outstanding. Under Plan II, there would be 120,000 shares of stock outstanding and $2.21 million in debt outstanding. The interest rate on the debt is 7 percent and there are no taxes.
a.
Use M&M Proposition I to find the price per share. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g.,32.16.)
b. What is the value of the firm under each of the two proposed plans?
Foundation, Incorporated, is comparing two different capital structures: an all-equity plan

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