Need ASAP 1 1/2 hours Finance Major

Grommit Engineering expects to have net income next year of $ 18.79 million and free cash flow of $ 9.40 million.Grommit's marginal corporate tax rate is 30 %

a. If Grommit increases leverage so that its interest expense rises by $ 7.3 million, how will net incomechange?

b. For the same increase in interestexpense, how will free cash flowchange?

a. If Grommit increases leverage so that its interest expense rises by $ 7.3 million, how will net incomechange?

If Grommit increases leverage so that its interest expense rises by $ 7.3 million, the net income will fall to $____million. (Round to two decimalplaces.)

b. For the same increase in interestexpense, how will free cash flowchange?

For the same increase in interestexpense, how will free cash flowchange? (Select the best choicebelow.)

A. Free cash flow decreases by the amount of the interest expense.

B. Free cash flow increases by the amount of the interest expense.

C. Free cash flow is not affected by interest expense.

D. None of the above.

Click to select your answer(s).