Swift Foot Couriers has the following financial information: Debt: ......................... $0 Book Equity: .............. $ 1,000,000 Tax

Question:

Swift Foot Couriers has the following financial information:
Debt: ......................... $0
Book Equity: .............. $ 1,000,000
Tax Rate: .................. 30%
EBIT: ....................... 5200,000
Swift Foot decides to borrow $500,000 at an 8% interest rate and, with the proceeds, buy back $500,000 of equity. Calculate return on equity before and after the loan and buy-back is made?