| Total funds used Rs. 50,00,000 (Shares of ? 10 each) |
| Interest rate 8% p.a. |
| Tax rate 40% |
| Earnings before Interest and Tax (EBIT) Rs. 7,50,000 |
| Debt |
| Situation I Nil |
| Situation II Rs. 15,00,000 |
| Situation III Rs. 35,00,000 |
Answer:
Situation I = Rs. 0.9, Situation II =Rs. 1.8, Situation III =Rs. 3.133
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