At about $0.99 to $1.29+ per download, selling music through itunes is one way music artists make a living. Sometimes the living gets big and getting on the top 10 in itunes sales makes one an instant multi millionaire. After Kurt became richer with the first Brandon rap song (though not in the itunes top 10), Loza made it real big when his second Brandon ra p song hit number 2 in the itunes chart. Bryson Gray (with his friends Tyson and Chandler, denoted BGTC hereafter) then continued their Amazon charttopping hits with the third Brandon rap song on the much larger itunes platform, going all the way up to number 1 on itunes. BGTC saw how Loza released another version of Brandon as well as a remix and now had 3 hits on the itunes top 10 (that is, multimillions times 3), and decided to perform a remix of their no. 1 Brandon to get another hit on the itun incorporated as an all es top 10 (and multi-- millions again). BGTCs Original no. 1 hit was equity project named BGTCO while the Remix would be a firm named BGTCR with $10,000,000 of 6 % bonds outstanding. Assume that EBIT is $2,000,000 in perpetuity for bot h (after all, Brandons higher prices or Brandonflation will go on forever), and that the cost of equity to the BGTCO firm is 10% and the cost of equity to the BGTCR firm is 15%. Next assume that V BGTCO = $20,000,000 and V BGTCR = $22,000,000. Using the MM propositions, demonstrate how to make a riskless profit from trading in BGTCO and BGTCR shares without investing a penny of ones own wealth. Of course we know arbitrage profits do not exist in the realworld, but rappers aroun different languages to make multid the world are now creating Brandon rap songs in millions on itunes. Brandon rap songs are especially popular in Arabic and French in Lebanon, which suffered severe oil shortages this year (no cooking, no hydro, no he at) as OPEC had to ship oil supplies to America again in 2021 after 4 years of having enough supplies to provide oil to developing countries. (10 points) b. Now in the same world without personal or corporate taxes and no transactions costs, assume BGTCRs A debt is risk as BGTCRs asset beta - free, so that the cost of debt R D equals the riskfree rate R that is, the systematic risk of the firms assets. Define E f . Define to be the beta of BGTCRs equity. Use the CAPM along with M&Ms Proposition II to f relationship between A and E . (10 points) ind the