eBook Video Compressed APV Model with Constant Growth An unlevered firm has a value of $850 million. An otherwise identical but levered firm has $40 million in debt at a 4% interest rate, which is its pre-tax cost of debt. Its unlevered cost of equity is 11%. After Year 1, free cash flows and tax savings are expected to grow at a constant rate of 3% Assuming the corporate tax rate is 25%, use the compressed adjusted present value model to determine the value of the levered firm. (Hint: The interest expense at Year 1 is based on the current level of debt.) Enter your answer in milions. For example, an answer of 519,550,000 should be entered as 10,55. Do not round Intermediate calculations, Round your answer to two decimal places, million $ . eBook Calculation of FCFE A company has the following information: Earnings before interest and $ 60.00 taxes Interest expense $14.00 Tax rate 25% Net change in debt $11.00 Investment in total capital $10.00 What is its free cash flow to equity? Do not round intermediate calculations. Round your answer to the nearest cent. s