Reliable Corp. currently has expected FCFs of $60 million per year, which are expected to continue forever. The first cash flow will occur one year from today. The firm has committed to keep a constant D/E ratio of 1.5. The firms unlevered (or asset) cost of capital (ru) is 12%. The firms debt has a yield of 6%. The debt has a probability of default of 2% and a loss given default of 50%. The corporate tax rate is 25%. a. What is the total value of Reliable Corp (what is the PV of Reliable Corps FCFs)? b. How much of this value is due to the firms decision to have debt in its capital structure (as opposed to being an all equity firm)?