Fowler, Inc., has no debt outstanding and a total market value of $$220,000.$ Earnings before interest and taxes, EBIT, are projected to be $$36,000$ if economic conditions are normal. If there is strong expansion in the economy, then EBIT will be $18$ percent higher. If there is a recession, then EBIT will be $25$ percent lower. The firm is considering a debt issue of $$125,000$ with an interest rate of $8$ percent. The proceeds will be used to repurchase shares of stock. There are currently $11,000$ shares outstanding. Ignore taxes for this problem. Assume the stock price is constant under all scenarios.

a$-1.$ Calculate earnings per share, EPS, under each of the three economic scenarios before any debt is issued. $($Do not round intermediate calculations and round your answers to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

a$-2.$ Calculate the percentage changes in EPS when the economy expands or enters a recession. $($A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

b$-1.$ 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$.$g$.,32\mathrm{.}16.)$

b$-2.$ Given the recapitalization, calculate the percentage changes in EPS when the economy expands or enters a recession. $($A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)\backslash$table$[[,,],[$a$-1.,$Recession EPS,$$,2\mathrm{.}45,],[,$Normal EPS,$$,3\mathrm{.}27,],[,$Expansion EPS,$$,3\mathrm{.}86,],[$a$-2.,$Recession,$-25\mathrm{.}00,\%,],[,$Expansion,$18\mathrm{.}00,\%$