Problem Two Matrix company has a capital of $200,000 with a debt ratio of 60% and paying interest for 12%. It has 9,000 shares outstanding that are expected to stay constant for any financing strategy taken and it has the following information: Price/ Unit $5 Variable cost/Unit $2 Fixed costs $50,000 Tax rate 40% The expected units sold based on probability of economic situation: Economy Good Normal Bad Probability 0.2 0.5 0.3 Units Sold 140,000 80,000 10,000 3. The expected ROE would be * a. 48.9% . O b. 147.01% O c. 9.9% . O d. 111.45% d O e. None of the above 6. The risk in the EPS would be * O a. $9.18 O b. 10.654% b O c. 7.245% . O d. $20.22 O e. None of the above 4. The expected EPS would be O a. 10.87% . O b.$13.07 O c.$10.87 O d.$9.903 O e.None of the above 1. The ROE in a normal economic situation would be * a. 131.7% a O b. 241.6% c. 327.3% O d. 3.273% e. None of the above 2. The EPS in a bad economic situation would be O a. -2.29% . O b. -$20,640 O C.-$1.33 O d. -$2.29 5. The risk in the ROE would be * a. a. 103.32% O b.413.33% c.0.565 d. 10.4 O e. None of the above