Jagdambay Exports has no debt outstanding and a total market value of $180,000. Earnings before interest and taxes, EBIT, are projected to be $23,000 if economic conditions are normal. If there is strong expansion in the economy, then EBIT will be 20% higher. If there is a recession, then EBIT will be 30% lower. Jagdambay Exports is considering a $75,000 debt issue with a 7% interest rate. The proceeds will be used to repurchase shares of stock. There are currently 6,000 shares outstanding. The tax rate is 35%. Based on the given information, please answer questions a and b.

Suppose the stock of Jagdambay Exports Corporation is currently trading at $20 per share.

a) If company issued a 20% stock dividend, what will its new price be? (1 Point)

b) If company does a 3:2 stock split, what will its new share price be? (1 Point)

c) If company does a 1:3 reverse split, what will its new share price be? (1 Point)