Reacher Technology's EBIT was $40 million last year and is not expected to grow (g=0) and...

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Reacher Technology's EBIT was $40 million last year and isnot expected to grow (g=0) and pays out 100% of earnings asdividends annually. The firm is currently financed with all equityand it has 10 million shares outstanding and is consideringrecaptizing its equity with debt where new debt would be issued andproceeds used to buyback stock. Show the firm's market value ofoperations, MV of debt, MV of equity, shares outstanding, and stockprice for each level of debt the firm is considering.
EBIT= $ 40.00 FCF=
Debt/Value WACC MV MV of Debt MV of Equity #Shares Stock
Price
0% 10
10%
20%
30%
40%
50%
60%
70%

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Reacher Technology's EBIT was $40 million last year and isnot expected to grow (g=0) and pays out 100% of earnings asdividends annually. The firm is currently financed with all equityand it has 10 million shares outstanding and is consideringrecaptizing its equity with debt where new debt would be issued andproceeds used to buyback stock. Show the firm's market value ofoperations, MV of debt, MV of equity, shares outstanding, and stockprice for each level of debt the firm is considering.EBIT=$ 40.00FCF=Debt/ValueWACCMVMV of DebtMV of Equity#SharesStockPrice0%1010%20%30%40%50%60%70%