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Fungers Chemical is financed entirely by common stock that is priced to offer a 12 % expected rate of return. The stock price is $60
Fungers Chemical is financed entirely by common stock that is priced to offer a 12 % expected rate of return. The stock price is $60 and the earnings per share are $7.20. If the company repurchases 20 percent of the stock and substitutes an equal value of debt yielding 8 percent, what is the expected earnings per share value after refinancing? (The answer should be rounded to the nearest cent.)
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