4. ABC Corporation is an all-equity financed firm. The following table describes the expectations about next year value of ABC Corporation's assets in place three states of the economy: State of the economy Boom Normal Bust Probability 1/3 1/3 1/3 Value of the Firm 400 300 200 Project X 450 450 0 The firm announces a new project (Project X) that requires an initial outlay of $250 today. The project returns $450 in the normal and boom states, and $0 in the bust state next year. Assume that the discount rate is zero. a) Suppose that the firm doesn't have any cash and issues a bond to raise $250. What is the face value of the bond? Would the management undertake the project? b) Now suppose bankruptcy is a costly process and the direct costs associated with it amounts to $160. What is the face value of the bond in this case? Would the management undertake the project?