Question: As an all equity firm, it has 30 million shares outstanding. After issuing $300 million of debt and repurchasing shares, its shares outstanding are 20

As an all equity firm, it has 30 million shares outstanding.

As an all equity firm, it has 30 million shares outstanding. After issuing $300 million of debt and repurchasing shares, its shares outstanding are 20 million. Its EBIT is $60 million. The risk free interest rate is 5%. Based on $60 million EBIT, its earnings per share as an all equity firm is $2.00. Calculate its earnings per share as a levered firm. EPS as a levered firm is $ Do not include a $ sign in your

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