Use the Following Information to Answer the Question(s)below

question 29

Multiple Choice

Use the following information to answer the question(s) below.
Nielson Motors is currently an all-equity financed firm.It expects to generate EBIT of $20 million over the next year.Currently Nielson has 8 million shares outstanding and its stock is trading at $20.00 per share.Nielson is considering changing its capital structure by borrowing $50 million at an interest rate of 8% and using the proceeds to repurchase shares.Assume perfect capital markets.
-Nielson's EPS if they change their capital structure is closest to:

• A)$2.00.
• B)$2.30.
• C)$2.50.
• D)$2.90.

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Definitions:

Free Radicals

Unstable molecules that can cause damage to cells and contribute to aging and diseases due to their reactive nature.

Full Night's Sleep

A period of sleep lasting typically between 7 to 9 hours, considered essential for optimal health and cognitive functioning.

REM Sleep

A phase of sleep characterized by rapid eye movements, increased breathing rate, and vivid dreams. It is considered a critical component of restorative sleep.

Stage 4 Sleep

The deep sleep stage, or delta sleep, where the body recovers, growth hormone is secreted, and the brain detoxifies, making it crucial for physical and mental health.