Acort Industries owns assets that will have an 80% probability of having a market value of $50 million in one year. There is a 20% chance that the assets will be worth only $20 million. The current risk-free rate is 5%, and Acort's assets have a cost of capital of 10%. a. If Acort is unlevered, what is the current market value of its equity? b. Suppose instead that Acort has debt with a face value of $20 million due in one year. According to MM, what is the value of Acort's equity in this case? c. What is the expected return of Acort's equity without leverage? What is the expected return of Acort's equity with leverage? d. What is the lowest possible realized return of Acort's equity with and without leverage? Answer: a. The current market value of the unlevered equity is $ million. (Round to three decimal places.) million. (Round to three decimal places.) b. According to MM, the current market value of the levered equity is $ c. The expected return of Acort's equity for both cases is: (Round to two decimal places.) Expected Return Without Leverage % (Round to two decimal places.) With Leverage % (Round to two decimal places.) d. The lowest possible realized return of Acort's equity in both cases will be: (Round to two decimal places.) Realized Return Without Leverage % (Round to two decimal places.) With Leverage % (Round to two decimal places.)