5. Assume in (4) above that the company changes its capital structure by replacing 40 per cent...

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5. Assume in (4) above that the company changes its capital structure by replacing 40 per cent equity by debt at 10 per cent cost. What is the change in the firm's expected EPS? If you assume the MM propositions under no-tax assumption, then what are the firm's opportunity cost of capital and the cost of equity?

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