5. Medilab Pharmaceuticals had EBIT of $379 million in 2016. In addition, Medilab had interest expenses of $141 million and a corporate tax rate of 40%.

a. What is Medilab's 2016 net profit? (Round to the nearest integer.)

b. What is the total of Medilab's 2016 net profit plus interest payments?

c. If Medilab had no interest expenses, what would its 2016 net profit have been? How does it compare to your answer in part b?

d. What is the amount of Medilab's interest tax shield in 2016?

6. Krypton Engineering expects to have net profit next year of $49.62 million and free cash flow of $22.44 million. Krypton's marginal corporate tax rate is 40%.

a. If Krypton increases leverage so that its interest expense rises by $21.8 million, how will its net profit change?

b. For the same increase in interest expense, how will free cash flow change?