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:

Social Change

The transformation over time in societal norms, values, and behaviors.

Social Order

The structured arrangement of societal relations and institutions that collectively form a society.

Durkheim

was a French sociologist known for his foundational contributions to the field of sociology, including studies on social cohesion and the role of religion in society.

Weber

Max Weber, a foundational figure in sociology, known for his theories on bureaucracy, social stratification, and the Protestant Ethic.