A debt-free firm produces a constant (assumed to go on indefinitely) EBIT(1-T) of $1,000,000 each year with the cost of capital of 10%. The value of this firm is If the firm decides to borrow 5 million dollar through a constantly- renewed (e.g. assumed indefinite) loan from the bank at 5% interest rate, the value of the firm will become : Corporate tax rate is 28%. A. $7.2 million; $5.7 million B. $7.2 million; $8.6 million C. $10 million ; $12.7 million D. $10 million : $11.4 million E. None of the above