C) FIN222 Ltd carries $24 million in debt. The market value of debt matches its book value of 24 million. The firm expects to generate $15 million per year in free cash flows after corporate taxes and these free cash flows are expected to grow at 2% per year in perpetuity. Each year, FIN222 Ltd is expected to pay out 70% of its free cash flows as dividends. The cost of debt is 10% before tax and the cost of equity to the firm is 12%. Corporate tax rate is 30%. Assume that all of its shareholders can fully utilise the franking credits. D) Assume a classical tax system and calculate the market value of equity. (1 mark) ii) Assume a classical tax system and calculate the WACC. (2 marks) Assume an imputation tax system and calculate the market value of equity. (2 marks) iv) Assume an imputation tax system and calculate the WACC. (2 marks) C) FIN222 Ltd carries $24 million in debt. The market value of debt matches its book value of 24 million. The firm expects to generate $15 million per year in free cash flows after corporate taxes and these free cash flows are expected to grow at 2% per year in perpetuity. Each year, FIN222 Ltd is expected to pay out 70% of its free cash flows as dividends. The cost of debt is 10% before tax and the cost of equity to the firm is 12%. Corporate tax rate is 30%. Assume that all of its shareholders can fully utilise the franking credits. D) Assume a classical tax system and calculate the market value of equity. (1 mark) ii) Assume a classical tax system and calculate the WACC. (2 marks) Assume an imputation tax system and calculate the market value of equity. (2 marks) iv) Assume an imputation tax system and calculate the WACC. (2 marks)