Glassmaker Corporation Data Glassmaker Corporation has a current capital structure consisting of $5 million (market value) of 11% bonds and $10 million (market value) of common stock. Glassmaker's beta is 1.36. Glassmaker faces a 40% tax rate. Glassmaker plans on making big changes in operation and capital structure during the next several years. (Its tax rate will remain unchanged.) Under these plans, the free cash flows for Glassmaker are estimated to be $3.0 million for each of the next 4 years; the horizon value of the free cash flows (discounted at the rate assumed by the compressed adjusted present value (CAPV) approach) is $10.0 million at Year 4. The estimated tax savings due to interest expenses are estimated to be $1 million for each of the next 4 years, the horizon value of the tax shields (discounted at the rate assumed by the CAPV approach) is estimated to be $5 million at Year 4. Glasimaker has no nonoperating assets. Currently, the risk-free rate is 6.0% and the market risk premium is 4.0%. Refer to data for Glassmaker Corporation. According to the compressed adjusted present value model, what discount rate should you use to discount Glassmaker's free cash flows and interest tax savings? 10.06% 11.44% 13.49% 11.29