A firm that manufactures telecommunication equipment. It reported earnings before interest and taxes of $ 400 million in the most recent financial year, and faced a 40% tax rate. In addition, the firm reinvests 40% of its after-tax operating income back into the business and expects to grow 5% in perpetuity. a. If the cost of capital is 10%, estimate the value of the firm. b. How would your answer change if both the growth rate and the cost of capital increase by 1%?