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Finch, Incorporated, is debating whether or not to convert its all - equity capital structure to one that is 2 5 percent debt. Currently, there

Finch, Incorporated, is debating whether or not to convert its all-equity capital structure to one that is 25 percent debt. Currently, there are 15,000 shares outstanding and the price per share is $38. EBIT is expected to remain at $48,000 per year forever. The interest rate on new debt is 9.5 percent, and there are no taxes.
Assume that Allison unlevers her shares and re-creates the original capital structure. What is her cash flow now?

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