Shantram firm is an incense producer. Shantram is an all-equity firm with 20 million shares outstanding, which are trading at $10 per share. Today, Shantram announced that it will issue a permanent debt worth $100 million and with this money it will repurchase shares in the market. The corporate tax in the market is 35%. Assume there are no personal taxes.

a. What is the market value of Shantram before the firms announcement?

b. What is the total value and the equity value of Shantram after the firm makes the announcement, but before it actually issues the debt?

c. What is the total value and the equity value of Shantram after it issued the debt but before it repurchased the stocks?

d. What is the total value of Shantram after the repurchase of its shares?

e. What is the equity value of Shantram after the repurchase of its shares?

f. What is the stock price of Shantram at the end of this transaction (after it issued debt and repurchased shares)?

g. How many shares did the firm repurchase?