Basis Corporation is comparing two different capital structures, an all-equity plan (Plan I) and a levered plan (Plan II). Under Plan I, the company would have 180,000 shares of stock outstanding. Under Plan II, there would be 130,000 shares of stock outstanding and $2.27 million in debt outstanding. The interest rate on the debt is 8 percent and there are no taxes.

1. Use MM Proposition I to find the price per share.
2. What is the value of the firm under the all-equity plan?
3. What is the value of the firm under the levered plan?