Currently, the firm is all equity funded with 1000000 shares valued at $10 per share and the required return on equity i

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Currently The Firm Is All Equity Funded With 1000000 Shares Valued At 10 Per Share And The Required Return On Equity I 1 (54.6 KiB) Viewed 42 times

Currently, the firm is all equity funded with 1000000 shares valued at $10 per share and the required return on equity is 8%. Income tax rate is 25%. Your banker has indicated that the following leverage restructurings are possible: Number of shares 750,000 600,000 500,000 Debt Leverage 25.00% 40.00% 50.00% Interest 7.50% 8.00% 8.50% ROE 8.50% 8.75% 9.25% Estimate the share prices for the following debt restructures 25%, 40%, and, 50%, respectively: $10.67: $10.41: $10.34 $10.41: $10.34: $10.67 $10.41: $10.67: $10.34 $10.67; $10.34; $10.41 $10.34: $10.67: $10.41