QUESTION 11 Assume a firm generates $400,000 EBIT annually, pays 40% tax rate, and has 80,000 shares outstanding. Calculate TIE (times interest earned if the firm decided to borrow $500,000 at 9% interest and repurchases stock with the proceeds. The current stock price is $25/share. 10.4 9.5 8.9 7.5 QUESTION 12 What is the IRR for the following project and will you accept such project if the WACC for the firm is 10%? The project has the following annual cash flows: CFO .$90; CF1=$50; CF2=$80. 26.1: Yes 25.1%; Yes 26.1; No 25.196: No