Ornaments, Incorporated, is an all$-$equity firm with a total market value of $$630,000$ and $29,500$ shares of stock outstanding.

Management believes the earnings before interest and taxes $($EBIT$)$ will be $$90,000$ if the economy is normal. If there is a recession,

EBIT will be $10$ percent lower, and if there is a boom, EBIT will be $20$ percent higher. The tax rate is $21$ percent. What is the EPS in a

recession?

Multiple Choice

$$2\mathrm{.}21$

$$2\mathrm{.}17$

$$1\mathrm{.}61$

$$2\mathrm{.}42$

$$2\mathrm{.}01$