Acme Storage has a market capitalization of $ 214 million, and debt outstanding of$ 220 million. Acme plans to maintain this same debt-equity ratio in the future. The firm pays an interest of 8.9% on its debt and has a corporate tax rate of 35%.
a. If Acme's free cash flow is expected to be $30.38 million next year and is expected to grow at a rate of 4% per year, what is Acme's WACC?
b. What is the value of Acme's interest tax shield?
a. If Acme's free cash flow is expected to be $ 30.38 million next year and is expected to grow at a rate of 4 % per year, what is Acme's WACC The WACC is 11?%.
(Round to the nearest integer.)
b. What is the value of Acme's interest tax shield?
The value of Acme's interest tax shield is $ million. (Round to two decimal places.)