Fowler, Inc., has no debt outstanding and a total market value of $$180000.$ Earnings before interest and taxes, EBIT, are projected to be $$25000$ if economic conditions are normal. If there is strong expansion in the economy, then EBIT will be $10$ percent higher. If there is a recession, then EBIT will be $20$ percent lower. The firm is considering a debt issue of $$60,000$ with an interest rate of $5$ percent. The proceeds will be used to repurchase shares of stock. There are currently $6000$ shares outstanding. The firm has a tax rate $21\%.$ Assume the stock price is constant under all scenarios. b

$-$

$1$

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$$Calculate earnings per share

$($

EPS

$)$

$$under each of the three economic scenarios

assuming the company goes through with recapitalization.

$($

Do not round

intermediate calculations and round your answers to

$2$

$$decimal places, e

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g

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$,$

$3$

$2$

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$1$

$6$

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