byrd 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 160,000 shares of stock outstanding. Under plan II, there would be 110,000 shares of stock outstanding and $1.41 million in debt outstanding. the interest rate on the debt is 7 percent and there are no taxes.

A. Use MM proposition I to find the price per share.

B. What is the value of the firm under each of the two proposed plans?