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Grommit Engineering expects to have net income next year of $ 44.08 million and free cash flow of $ 22.01 million. Grommit's marginal corporate tax
Grommit Engineering expects to have net income next year of $ 44.08 million and free cash flow of $ 22.01 million. Grommit's marginal corporate tax rate is 35 %. a. If Grommit increases leverage so that its interest expense rises by $ 5.8 million, how will net income change? b. For the same increase in interest expense, how will free cash flow change?
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