(CEITEPS analysis) Bal and Kate Thei are not only busband and Wife but entrepreneurs who have established three ouccesskui businesses. The proposed plan for their latest effort involves a series of internatonal retail cutets to distrbute and sorvice a full tine of ingenious home garden tools. The stores would be located in high-tratfic cities in Lafin America such as Parara Cily, Bogota, SSo Paulo, and Buenos Nres. The entrepreneurs have proposed two financing plans. Plan A is an al common-equity structure. Five mulion dollars would be raised by seling 125,000 shares of cormenon stock. Plan B would involvo the use of loog-tem debe financing. Three milish dollars would be malsed by markotrng bonds with an affective interest rate of 15 porcent. Under plan B, another $2 milion Would be raised by selling 50,000 shares of common stock. With both plans, 55 millon is needed to launch the new fimr's operasons. The debt funds rainod under plan B are considered to have no fixed maturity date, because this portion of finandial levorage is thought to be a permanent part of the company's capital structure. The two promiking entropreneurs have decided to use a 25 percent tax rate in their analysis, and they have hired you on a consuting basis to do the following: a. Find the Elit indifference lovel associated with the two financing proposals. b. Prepare income statements for the two plans that prove EPS wal be the same regardless of the plan chosen at the EBIT level found in part a. a. What is the EEIt ind flerence level associated wer the two financing proposals? (Round to the nearest dollag.)