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What is the break-even level of earnings before interest

Chick N' Fish is considering two different capital structures. The first option is an all-equity firm with 22,500 shares of stock. The second option consists of 18,750 shares of stock plus $120,000 of debt at an interest rate of 7.8%. Ignore taxes. What is the break-even level of earnings before interest and taxes (EBIT) between these two options?

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Finance Basics: What is the break-even level of earnings before interest

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