please complete all parts to the question
Question Help You are CEO of a high-growth technology firm. You plan to raise $170 million to fund a planned expansion by issuing either new shares or new debt. With the expansion, you expect earnings next year of $40 million. The firm currently has 15 million shares outstanding, with a price of $94 per share. Assume perfect capital markets a. If you raise the $170 million by selling new shares, what will the forecast for next year's earnings per share be? b. If you raise the $170 million by issuing new debt with an interest rate of 4%, what will the forecast for next year's earnings per share be? What le the file in DIE rotin that the cham nina hasta hus the anasta anminne for the coming urine What is the firme perfect capital markets. a. If you raise the $170 million by selling new shares, what will the forecast for next year's earnings per share be? b. If you raise the $170 million by Issuing new debt with an interest rate of 4%, what will the forecast for next year's earnings per share be? c. What is the firm's forward P/E ratio (that is, the share price divided by the expected earnings for the coming year) if it issues equity? What is the firm's forward P/E ratio if it issues debt? How can you explain the difference? a. If you raise the $170 million by selling new shares, what will the forecast for next year's earnings per share be? If you raise the $170 million by selling new shares, next year's EPS will be $per share. (Round to the nearest cent.) b. If you raise the $170 million by issuing new debt with an interest rate of 4%, what will the forecast for next year's earings per share be? Click to select your answer(s). c. What is the firm's forward P/E ratio (that is, the share price divided by the expected earnings for the coming year) if it issues equity? What is the firm's forward P/E ratio if it issues debt? How can you explain the difference? What is the firm's forward P/E ratio if it issues equity? What is the firm's forward P/E ratio if it issues debt? Click to select your answer(s). Ratio Forward P/E ratio for equity Forward P/E ratio for debt (Round to the nearest integer.) (Round to the nearest Integer) Click to select your answer(s). issues equity what forward P/E ratio if it issues debt? How can you explain the difference? How can you explain the difference? (Select the best choice below.) O A The lower P/E ratio is justified because with loverage, the EPS will decrease at a faster rate. OB. The higher P/E ratio is justified because with leverago, the EPS will decrease at a faster rate. Click to select your answer(s). malytics a. If you raise the $170 million by selling now shares, what will the forecast for next year's earnings per share be? b. If you raise the $170 million by issuing new debt with an interest rate of 4%, what will the forecast for next year's earnings per share be? c. What is the firm's forward P/E ratio (that is, the share price divided by the expected earnings for the coming year) if it issues equity? What is forward P/E ratio if it issues debt? How can you explain the difference? OB. The higher P/E ratio is justified because with leverage, the EPS will decrease at a faster rate. OC. The lower P/E ratio is justified because with loverago, EPS will grow at a faster rate. OD. The higher P/E ratio is justified because with leverage, EPS will grow at a faster rate. Click to select your answers