Music City, Inc., has no debt outstanding and a total market value of $220,000. Earnings before interest and taxes, EBIT, are projected to be $26.000 if economic conditions are normal. If there is strong expansion in the economy, then EBIT will be 15 percent higher if there is a recession, then EBIT will be 20 percent lower. The company is considering a $120.000 debt issue with an interest rate of 8 percent. The proceeds will be used to repurchase shares of stock. There are currently 11,000 shares outstanding The company has a tax rate 35 percent. Assume the stock price is constant. a-1. Calculate earnings per share (EPS) under each of the three economic scenarios before any debt is issued. (Do not round Intermediate calculations and round your answers to 2 decimal places, e.g. 32.16.) EPS 1.89 Recession $ Normal $ Expansions si $ 25960 2.72 a-2. Calculate the percentage changes in EPS when the economy expands or enters a recession. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to the nearest whole number ... 32) Percentage changes in EPS -19.92 Recession Expansion 15.25 b-1. Calculate earnings per share (EPS) under each of the three economic scenarios assuming the company goes through with recapitalization. (Do not round intermediate calculations and round your answers to 2 decimal places, 9... 32.16.) EPS 4.06 Recession $ 3.28 Normal 224 Expansions b-2. Given the recapitalization, calculate the percentage changes in EPS should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g.. 32.16.) Percentage changes in EPS Recession 31.71 Expansion 23.78