1)Wilson Industries needs to raise $28.07M for a new investment project. If the firm issues one-year debt, it may have to pay an interest rate of 11.86 %, although Wilson's managers believe that 5.76 % would be a fair rate given the level of risk. If the firm issues equity, they believe the equity may be underpriced by 11.96 %. What is the cost to current shareholders of financing the project out of Equity?

2) PLY borrows $5.73B by issuing 10-year bonds. YSL's cost of debt is 3.15%, so it will need to pay interest each year for the next 10 years, and then repay the principal of $5.73B in year 10. YSL's marginal tax rate will remain at 36.46% throughout this period. By how much does the interest tax shield increase the value of PLY?