You currently own 2,400 shares of Heavy Gear Inc. Heavy Gear is an all-equity firm that has 100,000 shares of stock outstanding at a market price of $50 a share. The company's earnings before interest and taxes are $250,000. Heavy Gear has decided to issue $1.5 million of debt at 8 percent interest. This debt will be used to repurchase shares of stock of the company.

If you prefer the original capital structure of 100% equity and the associated payoffs, you will take which of the following actions to achieve the original payoffs?

A. borrow $36,000 at 8% to purchase another 720 shares

B. borrow $60,000 at 8% to purchase another 1200 shares

C. sell 1200 shares and loan out the proceeds at 8%

D. sell 720 shares and loan out the proceeds at 8%

E. borrow $120,000 at 8% to purchase another 2400 shares