a 14. ABC has a total market value of $200 million, consisting of 1 million shares selling for $100 per share and $100 million of 10% perpetual bonds now selling at par. The company's EBIT is $15.34 million, and its tax rate is 25%. ABC can change its capital structure by decreasing its debt to 40%. If it decides to decrease its leverage, it will call its old bonds and replace them with new 9% coupon bonds. The company will sell or repurchase stock at the new equilibrium price to complete the capital structure change. ABC expects no growth in its EBIT, so gl is zero. Its current cost of equity, rs, is 14%. If it decreases leverage, rs will be 12%. a. (10 points) What is the firm's WACC if ABC decreases its debt to 40%? b. (10 points) What is the total corporate value if ABC decreases its debt to 40%