Modigliani & Miller Propositions You operate an all$-$equity financed company in perfect markets and generate earnings before interest and tax of $$300,000.$ Your

firm has just sold $$1\mathrm{.}6$ million worth of $3\mathrm{.}0\%$ coupon rate bonds and plans to use the proceeds to buy back outstanding shares of stock. Your firm's industry requires a

$9\mathrm{.}00\%$ ROA.

a$.$ Calculate the market price and required return for your firm's stock just prior to the repurchase.

b$.$ Calculate the market price and required return for your firm's stock just after the repurchase?