Page 8 of 35 Question 8 (1 point) ValUAdded Inc. is currently an all-equity firm with 2 million shares outstanding and a market capitalization of $50 million. The firm is considering borrowing $21 million and using the funds to buy back shares of the firm. The firm has an annual EBIT of $6 million in perpetuity. The cost of debt is 7.5% annually. Youssef is a shareholder of ValUAdded Inc, owning $25,000 worth of shares of the firm. There are no taxes, transactions costs or costs of financial distress, and investors can borrow and lend at the same rate as firms. Youssef likes the payoffs under the proposed capital structure. If the firm decides to maintain the current all- equity capital structure, how many more shares of the firm should Youssef buy (using money borrowed from a bank) in order to receive the same payoffs as he would have had under the proposed capital structure? Round your answer to the nearest integer (i.e., zero decimal places). Your Answer: Answer Page 8 of 35 Next Page