Augustine's Metaphysics Inc. is an all equity firm with an EBIT of $4 million. Investors require a 12% rate of return on Augustine's common stock. The company's tax rate is 30%. Assume that the M&M tax case assumptions hold. Required: (a) What is the value of Augustine's common equity? (2 Marks) ws (b) The company is considering a new capital structure whereby it would issue $7 million of 7% coupon debt. The proceeds would be used to repurchase equity. Assuming that this new capital structure is implemented, determine: The new market value of Augustine's common equity. (2 Marks) it. Augustine's new cost of common equity, (2 Marks) Augustine's new weighted average cost of capital. (2 Marks) N IV. By how much did the wealth of Augustine's shareholders change as a result of the change in capital structure? (2 Marks)