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Date Wireless has the following assets: Its operating profit (EBIT) is expected to be $2.4 million. Its tax rate is 40 percent. Shares are valued
Date Wireless has the following assets: Its operating profit (EBIT) is expected to be $2.4 million. Its tax rate is 40 percent. Shares are valued at $25. Capital structure is either short-term financing at 6 percent or equity. There is no long-term debt. (Round the final answers to 2 decimal places.) a. Calculate expected earnings per share (EPS) if the firm is perfectly hedged. EPS \$ b. Calculate expected EPS if it has a capital structure of 40% debt. EPS \$ c. Recalculate a and b if short-term rates go to 11 percent
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