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The Sandwich With A Pretty Big Plckie in it Corporation exists in a world of perfect capital markets with no market imperfections (such as corporate

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The Sandwich With A Pretty Big Plckie in it Corporation exists in a world of perfect capital markets with no market imperfections (such as corporate taxes or corts of financial distress). The firm has zero debt outstanding and its 9.5000 million ordinary shares currently trade for a total market value of $303.0500 million. The firm projects thaf their EBIT (Earnings Before Interest and Taxes) wiltbe 527.2700 million each year if economic conditions are normal. They also estimate that it the economy experiences a boom in growth that their EBIT will be 15.05 higher. Simlarly, they focecast that if there is a tecestion, then their EBIT will shrinik by 25.0% The Sandwich With A Pretty Big Pickle in It Corporaticn is considering a undertaking a leveraged recapitalization, which would consist of issuing $208.20 million worth of new debt at par and using the procecds from the sale 30 repurchase ordinary ahares from investors. The debt would cost the firm an interest rate of 3304 per annum You are encouraged to do no rounding in your intermediate calculations. Only round the final answers that you input as specified by the questions A) Using the above information, calculate the EPS (ie. Earnings Per Share) of The Sandich With A Pretty Big Pickle in it Corporation under each of the three economic states Rrior to issuing the debt. Aound each of your answers to 3 decimal places. Use the unrounded versions of your above answers to answer the following two questions: Compared to the normal economic state, how much larger (as a percentage) is the firmis EPS under the BooM coonomic state? 4. (Round your answer to 3 decimal pilaces) Compared to the normal economic state, how much smaller (as a percentage) is the firmis EPs under the RECESSION econcmic state? 4. (Round your answer to 3 decimal places. No minus sign is nweled) B) Now assume that the firm has berrowed the funds and completed the share repurchase. Recalculate the firms EPS under each of the economic scenarios. Round euch of your anseers ts 3 dtcimal plices

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