a) Due to large losses incurred in the past several years, a fimm has $2 billion in tax loss carryforwards. This means that the next $2 billion of the firm's income will be free from corporate income taxes. Security analysts estimate that it will take many years for the firm to generate $2 billion in earnings. The firm has a moderate amount of debt in its capital structure. The firm's CEO is deciding whether to issue debt or equity to raise the funds needed to finance an upcoming project. Which method of financing would you recommend? Why? (9 points) b) PT ABC is currently valued at Rp 900 million. Management wants to completely pay off its perpetual debt of Rp 300 million. PT ABC is subject to a 30 percent marginal tax rate. If PT ABC pays off its debt, what will be the total value of its equity? (8 points) c) The net income of Michigan Rockets is $ 85.000. The company has 25.000 outstanding shares and a 100 percent payout policy. The expected value of the firm one year from now is $ 1.725.000. The appropriate discount rate for Michigan Rockets is 12 percent, and the dividend tax rate is zero. What is the current value of the firm assuming the current dividend has not yet been paid? (8 points)