University Technologies, Inc. (UTI) has a current capital structure consisting of 5 million shares of common stock, $160 million of first-mortgage bonds with a coupon interest rate of 15 percent, and $50 million of preferred stock paying a 4 percent dividend. To expand into Asia, UTI will have to undertake an aggressive capital outlay campaign, expected to cost $120 million. This expansion can be financed either by selling 3 million new shares of common stock at a price of $40 per share or by the sale of $120 million of subordinated debentures at a pretax interest rate of 16 percent. The company's tax rate is 40 percent. a. Compute the EBIT-EPS indifference point between the equity and debt financing alternatives. Enter your answer in millions. For example, an answer of $1.11 million should be entered as 1.11 , not 1,110,000. Round your answer to two decimal places. $ million b. If UTI expects next year's EBIT to be $100 million with a standard deviation of $15 million, what is the probability that the equity financing option will produce higher earnings per share than the debt financing option? (Assume that EBIT is normally distributed.) Use Table V to answer the question. Round z value in intermediate calculations to two decimal places. Round your answer to two decimal places