Question: Plan A is an all common equity structure in which 2.2 million dollars would be raised by selling 88,000 shares of common stock. Plan B

Plan A is an all common equity structure in which 2.2 million dollars would be raised by selling 88,000 shares of common stock. Plan B would involve issuing $1.1 millon dollarsin long term bonds with an effective interest rate of 12.5% plus 1.1 million would be raised by selling $44,000 shares of common stock. The debt funds raised Under Plan B have no fixed maturity date, in that this amount of financial leverage is considered a permanent part of the firms capital structure. Abe and his partners plan to use a 34% tax rate in their analysis. The EBIT indifference level associated with the two financing plans is $___________(Round to the nearest $)

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