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Problem 3: Current Plan Proposed Plan Assets 550000 550000 Debt 0 250000 Equity 550000 300000 EBIT (Recession) 600000 780000 EBIT (Expansion) 820000 1300000 Shares Outstanding

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Problem 3: Current Plan Proposed Plan Assets 550000 550000 Debt 0 250000 Equity 550000 300000 EBIT (Recession) 600000 780000 EBIT (Expansion) 820000 1300000 Shares Outstanding 70000 38182 Interest Rate 4% 4% 4. Prepare the current capital structure and the proposed one based on the business cycles. 5. Analyze the results. 6. Calculate the break-even EBIT

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