Here is Establishment Industries market-value balance sheet (Figures in millions): Net working capital $ 700 Debt $ 1,050 Long-term assets 2,500 Equity 2,150 Value of firm $ 3,200 $ 3,200 The debt is yielding 6.5%, and the cost of equity is 14.5%. The tax rate is 31%. Investors expect this level of debt to be permanent.

a. What is Establishments WACC? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) WACC %

b. How would the market-value balance sheet change if Establishment retired all its debt? (Leave no cells blank - be certain to enter "0" wherever required. Do not round intermediate calculations. Round your answers to 1 decimal place.) New Market-Value Balance Sheet (figures in millions) Net working capital $

Debt $

Long-term assets

Equity

Value of firm $

Total $