Please answer 1,2 and 3

Question C-2: Financial Structure You are setting up a company for which you expect to require $420,000 in total assets and must finance through debt and or equity financing. You have two options you can chose financial structure #1 where you use $280,000 equity financing and $140,000 debt financing or financial structure #2 where you can use $280,000 debt financing and $140,000 in equity financing. Financial Structure #1 Financial Structure #2 Debt @ 10% $140,000 Debt @ 10% $280,000 Common stock 280,000 Common stock 140,000 Total $420,000 Total $420,000 Common shares 28,000 Common shares 14,000 1) Which financial structure has greater risk? Why. 2) At what level of EBIT would you be indifferent to the financial structure? Show Calculations. 3) If the company is expect to have an EBIT of $200,000 per year, which financial structure would benefit the shareholder? Why