Southern Wind is an all-equity firm with 16,900 shares of stock outstanding and a total market value of $352,000. Based on its current capital structure, the firm is expected to have earnings before interest and taxes of $26,000 if the economy is normal, $14,000 if the economy is in a recession, and $38,000 if the economy booms. Ignore taxes. Management is considering issuing $88,000 of debt with an interest rate of 6 percent. If the firm issues the debt, the proceeds will be used to repurchase stock. What will the earnings per share be if the debt is issued and the economy booms?

a. $2.98

b. $2.80

c. $2.58

d. $1.63