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Estimate the change in a firm eps

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Reference no: EM132952970

Estimate the change in a firm's EPS when it issues $1.5 million at a rate of 10% debt and the proceeds are used to repurchase half of the shares outstanding. Prior to issue of additional debt, the firm reported operating income worth $2 million, EPS of $2.5 and debt equal to $1 million (at a rate of 10%). (Ignore taxes)

Reference no: EM132952970

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