SuperStuff, Inc All the remaining questions are related to SuperStuff, Inc. Use the information below to compute the missing numbers and answer the questions. SuperStuff is considering a marketing/sales campaign in two similar countries, X and Y. The firm has equity capital of $200MM, which will cover the marketing campaign cost in country X. The firm may choose to take out a $200MM, 12% annual interest loan to enable a marketing campaign in country Y. Notes: Superstuff Inc. International Marketing Scenario Equity capital budget Debt capital budget Total Capital budget No Debt Option X only 200.00 0.00 200.00 Loan Option X and Y 200.00 200.00 400.00 Amount of firm's own money to use. Loan w 12% annual int. Tax rate is 35% No Debt Loan Option Projected IS for this project Marketing Cost (SGA) Resulting EBIT -200.00 250.00 500.00 Interest @ 12% EBT 0.00 50.00 2 76.00 Tax (35% of EBT) -17.50 3 NI 32.500 Debt to Total Project Capital 0.0% 5 ROE 16.3% 6 Answer all the following questions to find missing numbers 1 through 6. Use the given units to answer all questions. IE: if you were asked for the "Resulting EBIT" of the No Debt option, your answer would be 250.000, Question 6 What is the marketing campaign cost for the Loan Option? (This is missing item 1). This is a negative number. IE:-52.500, not 52.500 Question 7 What is the interest expense for the Loan Option? (This is missing item 2). This is a negative number. IE: -52.500, not 52.500 Question 8 What is the tax expense for the loan option. This is a negative number. IE: -52.500, not 52.500 Question 9 Is the net income for the loan option 49.4 +/-0.5? Yes Not enough information is provided to answer this question. O No Question 10 What is the Debt to Total Project Capital ratio for the Loan Option? Do not use %. IE: write 0.251 instead of 25.1%. Round your answer to two decimal places. Is the ROE higher for the Loan Option than for the No-Loan Option? They are roughly equal Yes. Not enough information is provided to answer this question. No. Question 12 Which strategy is riskier for Superstuff? O Market to X only O Market to X and Y Not enough information is provided to answer this question. They are equally risky. Question 13 What is one reason that the "X and Y" case has a higher ROE? None of the listed answers Occam's Razor Heisenberg Principle Tax Shield Economies of Scale