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Intro Depending on the demand for your product, your sales are expected as follows: Demand Prob. Sales Low 0.2 55 Medium 0.7 67 High 0.1

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Intro Depending on the demand for your product, your sales are expected as follows: Demand Prob. Sales Low 0.2 55 Medium 0.7 67 High 0.1 84 EBIT is expected to be 23% of sales and the average tax rate is 34. There is no debt, the market value of equity is 510 and there are 40 shares outstanding. The company is thinking of borrowing $250 at an interest rate of 4% to repurchase its shares at the current market value. Attempt 10/10 for 8 pts. Part 1 What is the standard deviation of ROIC before the recapitalization? 5+ decimals Submit Attempt 5/10 for 8 pts. Part 2 What is the standard deviation of EPS before the recapitalization? 4+ decimals Submit Attempt 2/10 for 10 pts. Part 3 What is the standard deviation of EPS after the recapitalization? 3+ decimals Submit

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