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A company has 7.25 million common shares outstanding and $59 million of debt with an interest rate of 5.4%. The company wants to raise another

A company has 7.25 million common shares outstanding and $59 million of debt with an interest rate of 5.4%. The company wants to raise another $47.2 million. It can do so by selling an additional 3.625 million shares of common stock (the equity plan) or by taking out a bank loan with an interest rate of 7.1% (the debt plan). The company has no preferred stock. The corporate tax rate is 26%. At what level of EBIT would the company have the same earnings per share (EPS) under either plan?

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