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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
16.1   EBIT and EPS Suppose the BDJ Corporation has decided in favor of a capital re- structuring that involves increasing its existing $80 million in debt to $125 million. The interest rate on the debt is 9 percent and is not expected to change. The firm currently has 10 million shares outstanding, and the price per share is $45. If the restructuring is expected to increase the ROE, what is the minimum level for EBIT that BDJ’s management must be expecting? Ignore taxes in your answer.
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