Stomp Transistors Inc. is currently an all-equity firm with 20 million shares outstanding and a stock price of $7.50 per share. Stomp plans to announce that it will borrow $50 million in perpetual debt and use the funds to repurchase shares; Stomp's announcement is not anticipated by investors and thus not reflected in the current stock price of $7.50 per share. Stomp will pay interest only on this debt, and it has no further plans to increase or decrease the amount of debt. Stomp is subject to a 40% corporate tax rate. ?bar a) What is the market value of Stomp's existing assets before the announcement? b) What is the market value of Stomp's assets just after the debt is issued, but before the shares are repurchased? c) What is Stomp's share price just before the share repurchase? How many shares will Stomp repurchase? d) What does Stomp's market value balance sheet look like after the share repurchase (describe its components, i.e., both the asset and liability side)? Calculate Stomp's share price after the share repurchase. Stomp Transistors Inc. is currently an all-equity firm with 20 million shares outstanding and a stock price of $7.50 per share. Stomp plans to announce that it will borrow $50 million in perpetual debt and use the funds to repurchase shares; Stomp's announcement is not anticipated by investors and thus not reflected in the current stock price of $7.50 per share. Stomp will pay interest only on this debt, and it has no further plans to increase or decrease the amount of debt. Stomp is subject to a 40% corporate tax rate. ?bar a) What is the market value of Stomp's existing assets before the announcement? b) What is the market value of Stomp's assets just after the debt is issued, but before the shares are repurchased? c) What is Stomp's share price just before the share repurchase? How many shares will Stomp repurchase? d) What does Stomp's market value balance sheet look like after the share repurchase (describe its components, i.e., both the asset and liability side)? Calculate Stomp's share price after the share repurchase