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Finch, Incorporated, is debating whether or not to convert its all - equity capital structure to one that is 2 6 percent debt. Currently, there

Finch, Incorporated, is debating whether or not to convert its all-equity capital structure to one that is 26 percent debt. Currently, there are 29,540 shares outstanding and the price per share is $71.06. EBIT is expected to remain at $114,801 per year forever. The interest rate on new debt is 8.42 percent, and there are no taxes. Allison, a shareholder of the firm, owns 643 shares of stock. Allisons cash flow be under the proposed capital structure of the firm will be $_____. Assume she keeps all of her shares and a payout ratio of 89%. Answer to two decimals. e.g.123.34. Do not round at any step. Assume that firms can issue partial shares.

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