DFS Corporation is currently an all-equity firm, with assets with a market value of $156 million and 6 million shares outstanding. DFS is considering a leveraged recapitalization to boost its share price. The firm plans to raise a fixed amount of permanent debt (i.e., the outstanding principal will remain constant) and use the proceeds to repurchase shares. DFS pays a 28% corporate tax rate, so one motivation for taking on the debt is to reduce the firm's tax liability. However, the upfront investment banking fees associated with the recapitalization will be 4% of the amount of debt raised. Adding leverage will also create the possibility of future financial distress or agency costs; shown in the table below, are DFS's estimates for different levels of debt.

Debt amount ($ million)	0	10	20	30	40	50
Present value of expected distress and agency costs ($ million)	0.0	-0.36	-2.29	-3.43	-8.21	-11.54

a. Based on this information, which level of debt is the best choice for DFS?

b. Estimate the stock price once this transaction is announced.