g) (3 points) Suppose the company stayed as an all equity financed firm. Because of a change in the countrys tax law, XYZ now has to pay 25% of its EBIT as taxes to the government. Determine the value of all equity financed XYZ when there are corporate taxes.

h) (2 points) The company wants to restructure its capital by issuing $3,327,465 in debt and buying back some of its shares outstanding. The required rate of return on debt of the company is still 8%. Determine the value of XYZ company after this capital structure change when there are corporate taxes.

3) (35 points) XYZ is an all equity financed firm with a constant EBIT of $1.75 million. The company does not pay any taxes currently. The company has a cost of equity of 20% and 500,000 shares outstanding