has debt outstanding with a market value of $3 million. The value of the firm would be $X million if it were entirely financed by equity. The company also has 360,000 shares of stock outstanding that sell at $50 per share. The corporate tax rate is 30 percent. The expected bankruptcy cost is 0.7 million. If there is no other market friction like agency cost/benefit, what is X?

A. 5.1

B. 20.8

C. 19.4

D. 0.7