Here are book and market value balance sheets of the United Frypan Company (UF): Book Value Balance Sheet Net working capital Long-term assets. $ 180 240 $ 200 Debt 220 Equity $ 420 $420 Market Value Balance Sheet Net working capital Long-term assets $ 180 300 $ 200 Debt 280 Equity $ 480 $ 480 Assume that MM's theory holds with taxes. There is no growth, and the $200 of debt is expected to be fixed and permanent. Assume a 30% corporate tax rate. a. How much of the firm's value in dollar terms is accounted for by the debt-generated tax shield? b. How much better off will UF's shareholders be if the firm borrows $180 more and uses it to repurchase stock? a. PV tax shield b. Increase in equity value