1. For a firm, you are given : It has a debtequity ratio of 0.75 It pays 8% interest on its debt. The corporate tax rate is 40%. Calculate the amount by which the interest tax shield from the firm's debt owners lowers the firm's weighted average cost of capital. 2. For a company, you are given: The company expects to have free cash flow in the coming year of 1,000 , and its free cash flow is expected to grow at a rate of 3% per year thereafter. The pre- tax WACC is 6%. The equity cost of capital is 12%. The debt cost of capital is 4%. The corporate tax rate is 21%. Suppose the company maintains a constant debt-equity ratio. Calculate the present value of the interest tax shield