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 155,000 shares of stock outstanding. Under Plan II, there would be 105,000 shares of stock outstanding and $1.33 million In debt outstanding. The Interest rate on the debt Is 6 percent, and there are no taxes.
a. Use M&M Proposition I to find the price per share.
Note: Do not round Intermedlate calculatlons and round your answer to 2 declmal places, e.g.,32.16.
b. What is the value of the firm under each of the two proposed plans?
Note: Do not round Intermedlate calculations and round your answers to the nearest whole number, e.g.,32.
\table[[a. Share price,],[b. All-equity firm value,],[Levered plan firm value,]]
 Foundation, Incorporated, Is comparing two different capital structures, an all-equity plan

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