Executive Cheese has issued debt with a market value of $100.56 million and has outstanding 15.60 million shares with a market price of $10 a share. It now announces that it intends to issue a further $55.44 million of debt and to use the proceeds to buy back common stock. Debtholders, seeing the extra risk, mark the value of the existing debt down to $60 million. Please show full working for the following questions.

a.Calculate the market price of the stock following the announcement.(Round your answer to 2 decimal places.)

Price of the stock=$?

b.How many shares can the company buy back with the $55.44 million of new debt that it issues?(Enter your answer in millions. Round your answer to 1 decimal place.)

Number ofshares=?million

c.What is the market value of the firm (equity plus debt) after the change in capital structure?(Enter your answer in millions. Round your answer to 2 decimal places.)

Market value=$? million

d.What is the debt ratio after the change in structure?(Round your answer to 2 decimal places.)

Debt ratio= ?