MK TV-mall., an online department store, is debating whether or not to convert its all-equity capital structure to one that is 30 percent debt. Currently there are 5,000 shares outstanding and the price per share is $40. EBIT is expected to remain at $44,000 per year forever. The interest rate on new debt is 8 percent, and there are no taxes. a. If the firm has a 100% dividend payout rate, what is the cash flow under the current capital structure to a shareholder (Mr. S) of the firm owning 60 shares of stock? b. Assume Mr. S keeps all 60 of his shares. What will his cash flow be under the proposed capital structure of the firm? c. Suppose Mr. S prefers the current all-equity capital structure, but MK TV-mall does convert. Show how he could unlever his shares of stock to recreate the original capital structure. d. Using your answer to part (c), is MK TV-mall's choice of capital structure relevant? Explain. MK TV-mall., an online department store, is debating whether or not to convert its all-equity capital structure to one that is 30 percent debt. Currently there are 5,000 shares outstanding and the price per share is $40. EBIT is expected to remain at $44,000 per year forever. The interest rate on new debt is 8 percent, and there are no taxes. a. If the firm has a 100% dividend payout rate, what is the cash flow under the current capital structure to a shareholder (Mr. S) of the firm owning 60 shares of stock? b. Assume Mr. S keeps all 60 of his shares. What will his cash flow be under the proposed capital structure of the firm? c. Suppose Mr. S prefers the current all-equity capital structure, but MK TV-mall does convert. Show how he could unlever his shares of stock to recreate the original capital structure. d. Using your answer to part (c), is MK TV-mall's choice of capital structure relevant? Explain