Problem 16-16 Tax Shields (LO2) River Cruises is all-equity-financed with 45,000 shares. It now proposes to issue $200,000 of debt at an interest rate of 12% and to use the proceeds to repurchase 20,000 shares. Suppose that the corporate tax rate is 35%. Calculate the dollar increase in the combined after-tax income of its debtholders and equityholders if profits before interest are: (Do not round intermediate calculations.) Increase in Cash Flow a. $70,000 b. $ 95,000 c. $ 170,000