Question: Windmere Corp currently is all - equity - financed. It has 1 5 , 0 0 0 shares of equity outstanding, selling at $ 1

Windmere Corp currently is all-equity-financed. It has 15,000 shares of equity outstanding, selling at $100 a share. The firm is considering a capital restructuring. The low-debt plan calls for a debt issue of $250,000 with the proceeds used to buy back shares.The high-debt plan would exchange $450,000 of debt for equity. The debt will pay an interest rate of 12%. The firm pays no taxes.

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