Here are book- and market-value balance sheets of the United Frypan Company:

Book-Value Balance Sheet
Net working capital	$45	Debt	$45
Long-term assets	$55	Equity	$55
	$100		$10

Market-Value Balance Sheet
Net working capital	$45	Debt	$45
Long-term assets	$200	Equity	$200
	$245		$245

Assume that MMs theory holds except for taxes. There is no growth, and the $45 of debt is expected to be permanent. Assume a 35% corporate tax rate.

The firm's market value accounted for by the debt-generated tax shield is $15.75.

United Frypan's after-tax WACC if r_Debt is 7.1% is 13.83%.

c. Now suppose that Congress passes a law that eliminates the deductibility of interest for tax purposes after a grace period of 5 years. What will be the new value of the firm, other things equal? Assume a borrowing rate of 7.1%. (Do not round intermediate calculations. Round your answer to 2 decimal places.)