**I only need clarification on Number 3! The first two answers are correct**

Reliable Gearing currently is all-equity-financed. It has 10,000 shares of equity outstanding, selling at $96 a share. The firm is considering a capital restructuring. The low-debt plan calls for a debt issue of $192,000 with the proceeds used to buy back stock. The high-debt plan would exchange $384,000 of debt for equity. The debt will pay an interest rate of 12%. The firm pays no taxes. a. What will be the debt-to-equity ratio if it borrows $192,000? (Round your answer to 2 decimal places.) Debt-to-equity ratio 0.25 b. If earnings before interest and tax (EBIT) are $103,000, what will be earnings per share (EPS) if Reliable borrows $192,000? (Round your answer to 2 decimal places.) EPS $ 9.99 c. What will EPS be if it borrows $384,000? (Round your answer to 2 decimal places.)