Sillery Manufacturing has market value of $424,878, unlevered cost of capital is 10.25 percent and a tax rate of 35 percent. The firm is considering issuing $139,000 in debt at an interest rate of 6.85 percent. What is the value of the firm according to M&M Proposition I with taxes if it issues the debt and uses the proceeds to repurchase shares? Should the company change its debt/equity ratio if the goal is to maximize the value of the firm? Explain.