Question $1$

Dutch Bros & Co$.$ will generate an EBIT of $100$ million in perpetuity. The company faces corporate income tax rate of $30\%,$ and its investors face an ordinary income tax rate of $20\%.$ The average tax rate on capital gains and dividends is $15\%.$ Assume no market imperfection other than taxes. The risk$-$free rate equals $5\%.$

a$)$ Find out the value of the unlevered firm.

b$)$ Suppose that the firm has a perpetual bond with an annual coupon $60$ million. Determine the value of debt, the value of equity, and the total firm value.