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6. Nizwa Finance, a prominent financing firm, is considering whether to convert its all equity capital structure to one that is 50% debt and 50%
6. Nizwa Finance, a prominent financing firm, is considering whether to convert its all equity capital structure to one that is 50% debt and 50% equity. Currently, there are 5,800 shares outstanding, and the price per share is OMR57. EBIT is expected to remain at OMR 32,000 per year. The interest rate on new debt is 8%, and there are no taxes. (i) You own 100 shares of stock. What is her cash flow (EBIT) under the current capital structure? (ii) What will your cash flow be under the proposed capital structure of the firm
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