Green Manufacturing, Inc., plans to announce that it will issue$2 million of perpetual debt and use the proceeds to repurchasecommon stock. The bonds will sell at par with a 2 percent annualcoupon rate. Green is currently an all-equity firm worth $10million with 800,000 shares of common stock outstanding. After thesale of the bonds, Green will maintain the new capital structureindefinitely. Green currently generates annual pretax earnings of$2 million. This level of earnings is expected to remain constantin perpetuity. Green is subject to a corporate tax rate of 39percent. (Unless otherwise noted, roundyour answers to 2 decimal places. (e.g., 0.16))

	a. The expected return on Green's market valueof equity before the announcement of the debt issueis  percent.
	b. Construct Green's market value balance sheetbefore the announcement of the debt issue.(Round your answers to the nearest dollar(e.g., 351)) Market Value BalanceSheet           Debt $         Assets $         Equity $         Total assets $         Total D & E $       The price per share of the firm's equity is $
	c. Construct Green's market value balance sheetimmediately after the announcement of the debt issue.(Round your answers to the nearest dollar(e.g., 351)) Market Value BalanceSheet   Old assets $         Debt $         PV(tax shield)         $         Equity $         Total assets $         Total D & E $
	d. Green's stock price per share immediatelyafter the repurchase announcement is $  .

    
     e. Green willrepurchase  shares as a result of the debt issue. Thereare  remaining shares after the repurchase.

     f. Construct themarket value balance sheet after the restructuring.(Round your answers to the nearest dollar(e.g., 351))

Market Value Balance Sheet
Old assets	$	Debt	$
PV(tax shield)	$	Equity	$
Total assets	$	Total D & E	$

    g. The required returnon Green's equity after the restructuringis  percent.