Find the indifference level associated with the following two plans:

A: all common equity structure in which 2.4 million dollars raised by selling 90,000 shares of common stock.

B: plan B involves issuing 1.4 million in long term bonds effective rate of 11.6% plus 1 million would be raised by selling 45,000 shares of common stock.

No fixed maturity date, and a 34% tax rate.

The formula for determining the indiff point is not difficult, but ultimately it starts with the following necessary equation:

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