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RT Auto, Inc. is an auto parts manufacturer. The companys depreciation and net income this year are provided below (in $ millions): ( Projected) Depreciation

RT Auto, Inc. is an auto parts manufacturer. The companys depreciation and net income this year are provided below (in $ millions):

(Projected)

Depreciation

350

Net Income

550

The company has two different business divisions, and each division is considering investing in a project:

Project

Investment

Estimated

Return on Equity

Beta

A

$490 mil

15.0%

0.9

B

$460 mil

16.0%

1.5

The treasury bond rate is 2.0%. The firm expects working capital to increase by $50 million. The firm is currently at its optimal debt ratio of 30%, and hence it plans to finance its net capital expenditures and working capital needs with 30% debt in order to remain at its optimal ratio.

The companys projected capital expenditure is . Assume an expected return on the market of 14%. Record your answer in millions of dollars, and omit the dollar symbol (e.g., record $100 million as 100).

The companys free cash flow to equity is . Record your answer in millions of dollars, and omit the dollar symbol (e.g., record $100 million as 100).

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