2 Pfizer, one of the largest pharmaceutical companies in the United States, is considering what its debt capacity is. Pfizer had an outstanding Market Value of Equity of USD 201 07 billion, debt of USD 90.7 billion and a A2 rating. Its beta was 1.47 and it faces marginal corporate tax rate of 40%. Risk Premium is 5.5%. The treasury bond rate is 4.30% and A2 bonds trade at a spread of 0.30% over Treasury. a. Estimate the current cost of capital of Pfizer. b. It is estimated that Pfizer will have a B1 rating if it moves to 40% debt value ratio. B1 bonds have a spread of 1.00% over Treasury. Estimate cost of capital t Pfizer moves to its optimal debt ratio. c. Assuming a constant growth rate of 6% in the firm value, how much w firm value change if Pfizer moves to optimal