#$4.$ Suppose firm $AB$ is considering spinning off division $B.$ There are no positive or negative

synergies between division A and division $B.$ Division $B$ is in need of raising $$20$ million via

bond sale. If this $$20$ million is raised and invested in division $B$ the cash flows of the divisions

are as follows: $[$For simplicity assume all cash flows are present values so there is no need to

discount the cash flows and the lender just needs to break even on average to extend a loan.$]$