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An all - equity firm with 5 2 , 2 5 0 shares of stock outstanding is considering the issue of $ 3 5 5

An all-equity firm with 52,250 shares of stock outstanding is considering the issue of $355,000 in debt at an interest rate of 9 percent and using the proceeds to repurchase stock. Under the new capital structure, there would be 32,500 shares of stock outstanding. Ignore taxes. What is the break-even EBIT which results in the same EPS for the two plans?

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