An industrial all-equity financed company, and its shares have a beta of 1.8. The management team expects a good level of earnings and dividends in the following years because of the economic recovery. The company has now 3 million shares. Its shares are listed on the stock exchange, and the price is now 12 euros. The price-earnings ratio (PER) is 15, above industry PER. The cost of equity is 20%. The management decides to repurchase 8% of its shares and to finance this repurchase with debt. The debt is risk-free at 4%. The company is exempt from corporate income taxes. Assuming MM are correct. a) What is the cost of equity after this operation? b) What is the WACC after this operation? c) What is the new PER? d) What is the immediate stock price reaction? e) What is the new beta? f) After the repurchase of its own shares, what is the debt ratio?