GAME is trading at $20 per share. The company is now considering a recapitalization. It wants to add $200 million of debt and would anticipate keeping the debt for a long time. The cost of debt is estimated to be 8%. GAME would use the debt to issue a divedend to shareholders or repurchase shares. Remember that GAME has 100 million shares outstanding and its tax rate is 20%. 1. I GAME were to issue a dividend, what would be the amount of the dividend per share the stock price and the resulting dividend yield? a Dividend = $2.00 share Stock price - $18.40 Yield = 10.9% 5. TFGAME were to buy back stock, how many shares would it be able to buy buy and at what stack price? share - 9.803,922 Steck price = 20:42 6. What is one trade-off GAME should consider in deciding if it wants to issue a dividend or buy back stock Qualitative