A firm issues 100,000 shares of common stock with a total market value of $5,000,000 and an equal amount of debt. The firm is expected to generate $1.5 million in operating income and pay 5% of the debt in interest. If the firm does not pay tax, what will happen to EPS if the firm repurchases $2,500,000 of shares and substitutes an equal amount of additional debt? Suppose that the operating income is expected to become $1.75 million after the change in the capital structure.